Private companies among Union Semiconductor (Hefei) Co., Ltd.'s (SHSE:688403) largest shareholders, saw gain in holdings value after stock jumped 24% last week

Key Insights

• Union Semiconductor (Hefei)'s significant private companies ownership suggests that the key decisions are influenced by shareholders from the larger public
• A total of 12 investors have a majority stake in the company with 51% ownership
• Institutions own 20% of Union Semiconductor (Hefei)

A look at the shareholders of Union Semiconductor (Hefei) Co., Ltd. (SHSE:688403) can tell us which group is most powerful. We can see that private companies own the lion's share in the company with 42% ownership. Put another way, the group faces the maximum upside potential (or downside risk).

As a result, private companies collectively scored the highest last week as the company hit CN¥7.0b market cap following a 24% gain in the stock.

Let's delve deeper into each type of owner of Union Semiconductor (Hefei), beginning with the chart below.

Check out our latest analysis for Union Semiconductor (Hefei)

What Does The Institutional Ownership Tell Us About Union Semiconductor (Hefei)?

Institutions typically measure themselves against a benchmark when reporting to their own investors, so they often become more enthusiastic about a stock once it's included in a major index. We would expect most companies to have some institutions on the register, especially if they are growing.

Union Semiconductor (Hefei) already has institutions on the share registry. Indeed, they own a respectable stake in the company. 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 Union Semiconductor (Hefei), (below). Of course, keep in mind that there are other factors to consider, too.

We note that hedge funds don't have a meaningful investment in Union Semiconductor (Hefei). Our data shows that Yangzhou Xinruilian Investment Partnership Enterprise (Limited Partnership) is the largest shareholder with 21% of shares outstanding. Meanwhile, the second and third largest shareholders, hold 4.6% and 4.2%, of the shares outstanding, respectively. Additionally, the company's CEO Ruijun Zheng directly holds 2.9% of the total shares outstanding.

A closer look at our ownership figures suggests that the top 12 shareholders have a combined ownership of 51% implying that 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. 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 Union Semiconductor (Hefei)

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. The company management answer to the board and the latter should represent the interests of shareholders. Notably, sometimes top-level managers are on the board themselves.

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.

We can report that insiders do own shares in Union Semiconductor (Hefei) Co., Ltd.. In their own names, insiders own CN¥200m worth of stock in the CN¥7.0b company. This shows at least some alignment. You can click here to see if those insiders have been buying or selling.

General Public Ownership

With a 33% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Union Semiconductor (Hefei). 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

It seems that Private Companies own 42%, of the Union Semiconductor (Hefei) stock. 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.

Next Steps:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. Take risks for example - Union Semiconductor (Hefei) has 2 warning signs (and 1 which shouldn't be ignored) we think you should know about.

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this 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.