Yonyou Network Technology Co.,Ltd.'s (SHSE:600588) largest shareholders are private companies who were rewarded as market cap surged CN¥1.6b last week

Key Insights

• The considerable ownership by private companies in Yonyou Network TechnologyLtd indicates that they collectively have a greater say in management and business strategy
• 51% of the business is held by the top 7 shareholders
• Using data from analyst forecasts alongside ownership research, one can better assess the future performance of a company

A look at the shareholders of Yonyou Network Technology Co.,Ltd. (SHSE:600588) can tell us which group is most powerful. And the group that holds the biggest piece of the pie are private companies with 48% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

As a result, private companies were the biggest beneficiaries of last week’s 3.9% gain.

Let's delve deeper into each type of owner of Yonyou Network TechnologyLtd, beginning with the chart below.

Check out our latest analysis for Yonyou Network TechnologyLtd

What Does The Institutional Ownership Tell Us About Yonyou Network TechnologyLtd?

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.

Yonyou Network TechnologyLtd 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 Yonyou Network TechnologyLtd, (below). Of course, keep in mind that there are other factors to consider, too.

Yonyou Network TechnologyLtd is not owned by hedge funds. Beijing Yongyou Technology Co., Ltd. is currently the company's largest shareholder with 27% of shares outstanding. Shanghai UfTech Consulting Co., Ltd is the second largest shareholder owning 11% of common stock, and Shanghai Yibei Management Consulting Co., Ltd. holds about 3.7% of the company stock.

We did some more digging and found that 7 of the top shareholders account for roughly 51% of the register, implying that along with larger shareholders, there are a few smaller shareholders, thereby balancing out each others interests somewhat.

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 Yonyou Network TechnologyLtd

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. 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.

Insider ownership is positive when it signals leadership are thinking like the true owners of the company. However, high insider ownership can also give immense power to a small group within the company. This can be negative in some circumstances.

We can see that insiders own shares in Yonyou Network Technology Co.,Ltd.. This is a big company, so it is good to see this level of alignment. Insiders own CN¥675m worth of shares (at current prices). If you would like to explore the question of insider alignment, 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 40% stake in Yonyou Network TechnologyLtd. This size of ownership, while considerable, may not be enough to change company policy if the decision is not in sync with other large shareholders.

Private Company Ownership

Our data indicates that Private Companies hold 48%, of the company's shares. It's hard to draw any conclusions from this fact alone, so its worth looking into who owns those private companies. Sometimes insiders or other related parties have an interest in shares in a public company through a separate private 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.

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.

Ultimately the future is most important. You can access this free report on analyst forecasts for the company.

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.