Both retail investors who control a good portion of Wuchan Zhongda Group Co.,Ltd. (SHSE:600704) along with institutions must be dismayed after last week's 3.8% decrease

Key Insights

• Wuchan Zhongda GroupLtd's significant retail investors ownership suggests that the key decisions are influenced by shareholders from the larger public
• The top 8 shareholders own 50% of the company
• 32% of Wuchan Zhongda GroupLtd is held by Institutions

If you want to know who really controls Wuchan Zhongda Group Co.,Ltd. (SHSE:600704), 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 retail investors with 46% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

While the holdings of retail investors took a hit after last week’s 3.8% price drop, institutions with their 32% holdings also suffered.

In the chart below, we zoom in on the different ownership groups of Wuchan Zhongda GroupLtd.

View our latest analysis for Wuchan Zhongda GroupLtd

What Does The Institutional Ownership Tell Us About Wuchan Zhongda GroupLtd?

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.

We can see that Wuchan Zhongda GroupLtd does have institutional investors; and they hold a good portion of the company's stock. This implies the analysts working for those institutions have looked at the stock and they like it. But just like anyone else, they could be wrong. It is not uncommon to see a big share price drop if two large institutional investors try to sell out of a stock at the same time. So it is worth checking the past earnings trajectory of Wuchan Zhongda GroupLtd, (below). Of course, keep in mind that there are other factors to consider, too.

Wuchan Zhongda GroupLtd is not owned by hedge funds. Zhejiang State-owned Capital Operation Co.,Ltd. is currently the company's largest shareholder with 25% of shares outstanding. With 17% and 3.6% of the shares outstanding respectively, Zhejiang Communications Investment Group Co.,Ltd. and Zhejiang Financial Development Company are the second and third largest shareholders.

We also observed that the top 8 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.

Researching institutional ownership is a good way to gauge and filter a stock's expected performance. The same can be achieved by studying analyst sentiments. We're not picking up on any analyst coverage of the stock at the moment, so the company is unlikely to be widely held.

Insider Ownership Of Wuchan Zhongda GroupLtd

The definition of company insiders can be subjective and does vary between jurisdictions. Our data reflects individual insiders, capturing board members at the very least. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.

I generally consider insider ownership to be a good thing. However, on some occasions it makes it more difficult for other shareholders to hold the board accountable for decisions.

Our data suggests that insiders own under 1% of Wuchan Zhongda Group Co.,Ltd. in their own names. We do note, however, it is possible insiders have an indirect interest through a private company or other corporate structure. It's a big company, so even a small proportional interest can create alignment between the board and shareholders. In this case insiders own CN¥15m worth of shares. Arguably, recent buying and selling is just as important to consider. You can click here to see if insiders have been buying or selling.

General Public Ownership

The general public, who are usually individual investors, hold a 46% stake in Wuchan Zhongda GroupLtd. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.

Private Company Ownership

Our data indicates that Private Companies hold 22%, of the company's shares. Private companies may be related parties. Sometimes insiders have an interest in a public company through a holding in a private company, rather than in their own capacity as an individual. While it's hard to draw any broad stroke conclusions, it is worth noting as an area for further research.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Wuchan Zhongda GroupLtd better, we need to consider many other factors. Be aware that Wuchan Zhongda GroupLtd is showing 1 warning sign in our investment analysis , you should know about...

Of course this may not be the best stock to buy. So take a peek at this free free list of interesting companies.

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.

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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.