Retail investors among Wuxi NCE Power Co.,Ltd.'s (SHSE:605111) largest stockholders and were hit after last week's 3.6% price drop

Key Insights

• Significant control over Wuxi NCE PowerLtd by retail investors implies that the general public has more power to influence management and governance-related decisions
• 42% of the business is held by the top 25 shareholders
• Insiders own 24% of Wuxi NCE PowerLtd

If you want to know who really controls Wuxi NCE Power Co.,Ltd. (SHSE:605111), then you'll have to look at the makeup of its share registry. We can see that retail investors own the lion's share in the company with 56% 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 24% shares weren’t spared from last week’s CN¥424m market cap drop, retail investors as a group suffered the maximum losses

Let's delve deeper into each type of owner of Wuxi NCE PowerLtd, beginning with the chart below.

See our latest analysis for Wuxi NCE PowerLtd

What Does The Institutional Ownership Tell Us About Wuxi NCE PowerLtd?

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 Wuxi NCE PowerLtd does have institutional investors; and they hold a good portion of the company's stock. This suggests some credibility amongst professional investors. But we can't rely on that fact alone since institutions make bad investments sometimes, just like everyone does. 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 Wuxi NCE PowerLtd, (below). Of course, keep in mind that there are other factors to consider, too.

Hedge funds don't have many shares in Wuxi NCE PowerLtd. With a 22% stake, CEO Yuanzheng Zhu is the largest shareholder. In comparison, the second and third largest shareholders hold about 4.4% and 2.6% of the stock.

A deeper look at our ownership data shows that the top 25 shareholders collectively hold less than half of the register, suggesting a large group of small holders where no single shareholder has a majority.

While studying institutional ownership for a company can add value to your research, it is also a good practice to research analyst recommendations to get a deeper understand of a stock's expected performance. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.

Insider Ownership Of Wuxi NCE PowerLtd

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. 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.

Most consider insider ownership a positive because it can indicate the board is well aligned with other shareholders. However, on some occasions too much power is concentrated within this group.

Our information suggests that insiders maintain a significant holding in Wuxi NCE Power Co.,Ltd.. Insiders own CN¥2.7b worth of shares in the CN¥11b 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, mostly comprising of individual investors, collectively holds 56% of Wuxi NCE PowerLtd shares. This level of ownership gives investors from the wider public some power to sway key policy decisions such as board composition, executive compensation, and the dividend payout ratio.

Private Company Ownership

We can see that Private Companies own 3.6%, of the shares on issue. It might be worth looking deeper into this. If related parties, such as insiders, have an interest in one of these private companies, that should be disclosed in the annual report. Private companies may also have a strategic interest in the company.

Public Company Ownership

It appears to us that public companies own 4.4% of Wuxi NCE PowerLtd. This may be a strategic interest and the two companies may have related business interests. It could be that they have de-merged. This holding is probably worth investigating further.

Next Steps:

While it is well worth considering the different groups that own a company, there are other factors that are even more important.

I like to dive deeper into how a company has performed in the past. You can access this interactive graph of past earnings, revenue and cash flow, for free.

If you are like me, you may want to think about whether this company will grow or shrink. Luckily, you can check this free report showing analyst forecasts for its future.

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.