Retail investors invested in Beijing Bohui Science & Technology Co., Ltd (SHSE:688004) copped the brunt of last week's CN¥150m market cap decline

Key Insights

• The considerable ownership by retail investors in Beijing Bohui Science & Technology indicates that they collectively have a greater say in management and business strategy
• 51% of the business is held by the top 8 shareholders
• 33% of Beijing Bohui Science & Technology is held by insiders

A look at the shareholders of Beijing Bohui Science & Technology Co., Ltd (SHSE:688004) can tell us which group is most powerful. The group holding the most number of shares in the company, around 46% to be precise, is retail investors. Put another way, the group faces the maximum upside potential (or downside risk).

While insiders who own 33% came under pressure after market cap dropped to CN¥788m last week,retail investors took the most losses.

Let's delve deeper into each type of owner of Beijing Bohui Science & Technology, beginning with the chart below.

View our latest analysis for Beijing Bohui Science & Technology

What Does The Institutional Ownership Tell Us About Beijing Bohui Science & Technology?

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.

Less than 5% of Beijing Bohui Science & Technology is held by institutional investors. This suggests that some funds have the company in their sights, but many have not yet bought shares in it. So if the company itself can improve over time, we may well see more institutional buyers in the future. We sometimes see a rising share price when a few big institutions want to buy a certain stock at the same time. The history of earnings and revenue, which you can see below, could be helpful in considering if more institutional investors will want the stock. Of course, there are plenty of other factors to consider, too.

Hedge funds don't have many shares in Beijing Bohui Science & Technology. The company's largest shareholder is Chuanming Sun, with ownership of 18%. Meanwhile, the second and third largest shareholders, hold 10% and 6.5%, of the shares outstanding, respectively. Zhongwu Guo, who is the third-largest shareholder, also happens to hold the title of Member of the Board of Directors.

On further inspection, we found that more than half the company's shares are owned by the top 8 shareholders, suggesting that the interests of the larger shareholders are balanced out to an extent by the smaller ones.

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. We're not picking up on any analyst coverage of the stock at the moment, so the company is unlikely to be widely held.

Insider Ownership Of Beijing Bohui Science & Technology

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 insiders own a significant proportion of Beijing Bohui Science & Technology Co., Ltd. It has a market capitalization of just CN¥788m, and insiders have CN¥263m worth of shares in their own names. It is great to see insiders so invested in the business. It might be worth checking if those insiders have been buying recently.

General Public Ownership

With a 46% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Beijing Bohui Science & Technology. 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

We can see that Private Companies own 5.7%, of the shares on issue. 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.

Public Company Ownership

We can see that public companies hold 10% of the Beijing Bohui Science & Technology shares on issue. This may be a strategic interest and the two companies may have related business interests. It could be that they have de-merged. This holding is probably worth investigating further.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Beijing Bohui Science & Technology better, we need to consider many other factors. For example, we've discovered 2 warning signs for Beijing Bohui Science & Technology (1 makes us a bit uncomfortable!) that you should be aware of before investing here.

Of course this may not be the best stock to buy. So take a peek at this free 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.