Recent 4.1% pullback would hurt Shenzhen Kangtai Biological Products Co., Ltd. (SZSE:300601) insiders

Key Insights

• Significant insider control over Shenzhen Kangtai Biological Products implies vested interests in company growth
• A total of 6 investors have a majority stake in the company with 50% ownership
• Using data from analyst forecasts alongside ownership research, one can better assess the future performance of a company

If you want to know who really controls Shenzhen Kangtai Biological Products Co., Ltd. (SZSE:300601), then you'll have to look at the makeup of its share registry. And the group that holds the biggest piece of the pie are individual insiders with 48% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

And last week, insiders endured the biggest losses as the stock fell by 4.1%.

Let's delve deeper into each type of owner of Shenzhen Kangtai Biological Products, beginning with the chart below.

See our latest analysis for Shenzhen Kangtai Biological Products

What Does The Institutional Ownership Tell Us About Shenzhen Kangtai Biological Products?

Institutional investors commonly compare their own returns to the returns of a commonly followed index. So they generally do consider buying larger companies that are included in the relevant benchmark index.

Shenzhen Kangtai Biological Products already has institutions on the share registry. Indeed, they own a respectable stake in the company. This can indicate that the company has a certain degree of credibility in the investment community. However, it is best to be wary of relying on the supposed validation that comes with institutional investors. They too, get it wrong sometimes. If multiple institutions change their view on a stock at the same time, you could see the share price drop fast. It's therefore worth looking at Shenzhen Kangtai Biological Products' earnings history below. Of course, the future is what really matters.

We note that hedge funds don't have a meaningful investment in Shenzhen Kangtai Biological Products. Weimin Du is currently the company's largest shareholder with 25% of shares outstanding. For context, the second largest shareholder holds about 19% of the shares outstanding, followed by an ownership of 2.2% by the third-largest shareholder.

We also observed that the top 6 shareholders account for more than half of the share register, with a few smaller shareholders to balance the interests of the larger ones to a certain extent.

While it makes sense to study institutional ownership data for a company, it also makes sense to study analyst sentiments to know which way the wind is blowing. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.

Insider Ownership Of Shenzhen Kangtai Biological Products

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. Management ultimately answers to the board. However, it is not uncommon for managers to be executive board members, especially if they are a founder or the CEO.

Insider ownership is positive when it signals leadership are thinking like the true owners of the company. However, high insider ownership can also give immense power to a small group within the company. This can be negative in some circumstances.

Our most recent data indicates that insiders own a reasonable proportion of Shenzhen Kangtai Biological Products Co., Ltd.. Insiders own CN¥8.4b worth of shares in the CN¥17b company. That's quite meaningful. Most would be pleased to see the board is investing alongside them. You may wish to access this free chart showing recent trading by insiders.

General Public Ownership

The general public-- including retail investors -- own 43% stake in the company, and hence can't easily be ignored. While this size of ownership may not be enough to sway a policy decision in their favour, they can still make a collective impact on company policies.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Shenzhen Kangtai Biological Products better, we need to consider many other factors. To that end, you should be aware of the 2 warning signs we've spotted with Shenzhen Kangtai Biological Products .

Ultimately the future is most important. You can access this free report on analyst forecasts for the company.

NB: Figures in this article are calculated using data from the last twelve months, which refer to the 12-month period ending on the last date of the month the financial statement is dated. This may not be consistent with full year annual report figures.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com