Yingkou Jinchen Machinery Co., Ltd.'s (SHSE:603396) stock price dropped 11% last week; individual investors would not be happy

Key Insights

• Yingkou Jinchen Machinery's significant individual investors ownership suggests that the key decisions are influenced by shareholders from the larger public
• The top 9 shareholders own 51% of the company
• 40% of Yingkou Jinchen Machinery is held by insiders

Every investor in Yingkou Jinchen Machinery Co., Ltd. (SHSE:603396) should be aware of the most powerful shareholder groups. And the group that holds the biggest piece of the pie are individual investors with 47% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

While insiders, who own 40% shares weren’t spared from last week’s CN¥407m market cap drop, individual investors as a group suffered the maximum losses

Let's delve deeper into each type of owner of Yingkou Jinchen Machinery, beginning with the chart below.

Check out our latest analysis for Yingkou Jinchen Machinery

What Does The Institutional Ownership Tell Us About Yingkou Jinchen Machinery?

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 Yingkou Jinchen Machinery does have institutional investors; and they hold a good portion of the company's stock. 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 Yingkou Jinchen Machinery's earnings history below. Of course, the future is what really matters.

Hedge funds don't have many shares in Yingkou Jinchen Machinery. With a 36% stake, CEO Yisheng Li is the largest shareholder. In comparison, the second and third largest shareholders hold about 3.9% and 2.2% of the stock. Interestingly, the third-largest shareholder, Yan Yang is also a Member of the Board of Directors, again, indicating strong insider ownership amongst the company's top shareholders.

On further inspection, we found that more than half the company's shares are owned by the top 9 shareholders, suggesting that the interests of the larger shareholders are balanced out to an extent by the smaller ones.

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. As far as we can tell there isn't analyst coverage of the company, so it is probably flying under the radar.

Insider Ownership Of Yingkou Jinchen Machinery

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. 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 most recent data indicates that insiders own a reasonable proportion of Yingkou Jinchen Machinery Co., Ltd.. Insiders own CN¥1.4b worth of shares in the CN¥3.5b company. We would say this shows alignment with shareholders, but it is worth noting that the company is still quite small; some insiders may have founded the business. You can click here to see if those insiders have been buying or selling.

General Public Ownership

With a 47% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Yingkou Jinchen Machinery. 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

We can see that Private Companies own 3.9%, of the shares on issue. 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:

I find it very interesting to look at who exactly owns a company. But to truly gain insight, we need to consider other information, too. Be aware that Yingkou Jinchen Machinery is showing 2 warning signs in our investment analysis , you should know about...

If you would prefer check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, backed by strong financial data.

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.