Shanghai Wondertek Software Co., Ltd (SHSE:603189) surges 9.7%; retail investors who own 48% shares profited along with insiders

Key Insights

• Shanghai Wondertek Software's significant retail investors ownership suggests that the key decisions are influenced by shareholders from the larger public
• The top 9 shareholders own 50% of the company
• Insiders own 43% of Shanghai Wondertek Software

Every investor in Shanghai Wondertek Software Co., Ltd (SHSE:603189) should be aware of the most powerful shareholder groups. The group holding the most number of shares in the company, around 48% to be precise, is retail investors. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

Retail investors gained the most after market cap touched CN¥4.6b last week, while insiders who own 43% also benefitted.

In the chart below, we zoom in on the different ownership groups of Shanghai Wondertek Software.

See our latest analysis for Shanghai Wondertek Software

What Does The Institutional Ownership Tell Us About Shanghai Wondertek Software?

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.

Since institutions own only a small portion of Shanghai Wondertek Software, many may not have spent much time considering the stock. But it's clear that some have; and they liked it enough to buy in. So if the company itself can improve over time, we may well see more institutional buyers in the future. When multiple institutional investors want to buy shares, we often see a rising share price. The past revenue trajectory (shown below) can be an indication of future growth, but there are no guarantees.

Hedge funds don't have many shares in Shanghai Wondertek Software. From our data, we infer that the largest shareholder is Hong Ye Jiang (who also holds the title of Senior Key Executive) with 36% of shares outstanding. Its usually considered a good sign when insiders own a significant number of shares in the company, and in this case, we're glad to see a company insider play the role of a key stakeholder. The second and third largest shareholders are Da Feng and Chengtong Mixed Reform Private Fund Management Co., Ltd., with an equal amount of shares to their name at 5.1%. Interestingly, the second-largest shareholder, Da Feng is also Chief Executive Officer, again, pointing towards strong insider ownership amongst the company's top shareholders.

We also observed that the top 9 shareholders account for more than half of the share register, with a few smaller shareholders to balance the interests of the larger ones to a certain extent.

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. There is a little analyst coverage of the stock, but not much. So there is room for it to gain more coverage.

Insider Ownership Of Shanghai Wondertek Software

The definition of company insiders can be subjective and does vary between jurisdictions. Our data reflects individual insiders, capturing board members at the very least. 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.

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.

It seems insiders own a significant proportion of Shanghai Wondertek Software Co., Ltd. Insiders have a CN¥2.0b stake in this CN¥4.6b business. 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 48% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Shanghai Wondertek Software. 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 Equity Ownership

Private equity firms hold a 5.0% stake in Shanghai Wondertek Software. This suggests they can be influential in key policy decisions. Some might like this, because private equity are sometimes activists who hold management accountable. But other times, private equity is selling out, having taking the company public.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Shanghai Wondertek Software better, we need to consider many other factors. To that end, you should learn about the 3 warning signs we've spotted with Shanghai Wondertek Software (including 1 which doesn't sit too well with us) .

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.