Recent uptick might appease Fujian Apex Software Co.,LTD (SHSE:603383) institutional owners after losing 11% over the past year

Key Insights

• Given the large stake in the stock by institutions, Fujian Apex SoftwareLTD's stock price might be vulnerable to their trading decisions
• 52% of the business is held by the top 6 shareholders
• Insiders own 33% of Fujian Apex SoftwareLTD

A look at the shareholders of Fujian Apex Software Co.,LTD (SHSE:603383) can tell us which group is most powerful. And the group that holds the biggest piece of the pie are institutions with 34% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

Institutional investors would probably welcome last week's 5.4% increase in the share price after a year of 11% losses as a sign that returns may to begin trending higher.

In the chart below, we zoom in on the different ownership groups of Fujian Apex SoftwareLTD.

See our latest analysis for Fujian Apex SoftwareLTD

What Does The Institutional Ownership Tell Us About Fujian Apex SoftwareLTD?

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 Fujian Apex SoftwareLTD 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. When multiple institutions own a stock, there's always a risk that they are in a 'crowded trade'. When such a trade goes wrong, multiple parties may compete to sell stock fast. This risk is higher in a company without a history of growth. You can see Fujian Apex SoftwareLTD's historic earnings and revenue below, but keep in mind there's always more to the story.

Hedge funds don't have many shares in Fujian Apex SoftwareLTD. Meng Yu Yan is currently the largest shareholder, with 21% of shares outstanding. With 14% and 6.9% of the shares outstanding respectively, Fujian Aipaike Electronics Co., Ltd. and Wei Zhao are the second and third largest shareholders. Wei Zhao, who is the third-largest shareholder, also happens to hold the title of Vice Chairman.

We also observed that the top 6 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.

Researching institutional ownership is a good way to gauge and filter a stock's expected performance. The same can be achieved by studying analyst sentiments. There are plenty of analysts covering the stock, so it might be worth seeing what they are forecasting, too.

Insider Ownership Of Fujian Apex SoftwareLTD

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. 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.

It seems insiders own a significant proportion of Fujian Apex Software Co.,LTD. It is very interesting to see that insiders have a meaningful CN¥2.4b stake in this CN¥7.4b business. Most would say this shows a good degree of alignment with shareholders, especially in a company of this size. You can click here to see if those insiders have been buying or selling.

General Public Ownership

The general public, who are usually individual investors, hold a 19% stake in Fujian Apex SoftwareLTD. 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 14%, of the Fujian Apex SoftwareLTD 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:

I find it very interesting to look at who exactly owns a company. But to truly gain insight, we need to consider other information, too. Consider risks, for instance. Every company has them, and we've spotted 1 warning sign for Fujian Apex SoftwareLTD you should know about.

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.

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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.