With a 54% stake, Wuhan DR Laser Technology Corp.,Ltd (SZSE:300776) insiders have a lot riding on the company

Key Insights

• Insiders appear to have a vested interest in Wuhan DR Laser TechnologyLtd's growth, as seen by their sizeable ownership
• 54% of the business is held by the top 3 shareholders
• Ownership research along with analyst forecasts data help provide a good understanding of opportunities in a stock

If you want to know who really controls Wuhan DR Laser Technology Corp.,Ltd (SZSE:300776), then you'll have to look at the makeup of its share registry. With 54% stake, individual insiders possess the maximum shares in the company. Put another way, the group faces the maximum upside potential (or downside risk).

With such a notable stake in the company, insiders would be highly incentivised to make value accretive decisions.

In the chart below, we zoom in on the different ownership groups of Wuhan DR Laser TechnologyLtd.

View our latest analysis for Wuhan DR Laser TechnologyLtd

What Does The Institutional Ownership Tell Us About Wuhan DR Laser TechnologyLtd?

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.

We can see that Wuhan DR Laser TechnologyLtd 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. 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 Wuhan DR Laser TechnologyLtd's earnings history below. Of course, the future is what really matters.

Hedge funds don't have many shares in Wuhan DR Laser TechnologyLtd. The company's CEO Zhigang Li is the largest shareholder with 41% of shares outstanding. Xiaoting Duan is the second largest shareholder owning 8.7% of common stock, and Xinbo Peng holds about 4.1% of the company stock. Interestingly, the second and third-largest shareholders also happen to be the Senior Key Executive and Chairman of Corporate Board, respectively. This once again signifies considerable insider ownership amongst the company's top shareholders.

After doing some more digging, we found that the top 3 shareholders collectively control more than half of the company's shares, implying that they have considerable power to influence the company's decisions.

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. There are plenty of analysts covering the stock, so it might be worth seeing what they are forecasting, too.

Insider Ownership Of Wuhan DR Laser TechnologyLtd

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.

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.

It seems that insiders own more than half the Wuhan DR Laser Technology Corp.,Ltd stock. This gives them a lot of power. Given it has a market cap of CN¥17b, that means insiders have a whopping CN¥9.3b worth of shares in their own names. Most would argue this is a positive, showing strong alignment with shareholders. You can click here to see if they have been selling down their stake.

General Public Ownership

The general public-- including retail investors -- own 33% 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.

Private Company Ownership

It seems that Private Companies own 3.6%, of the Wuhan DR Laser TechnologyLtd stock. 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 Wuhan DR Laser TechnologyLtd better, we need to consider many other factors. For instance, we've identified 1 warning sign for Wuhan DR Laser TechnologyLtd that you should be aware of.

If you would prefer discover what analysts are predicting in terms of future growth, do not miss this free report on analyst forecasts.

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.