DBAPPSecurity Co., Ltd.'s (SHSE:688023) 8.3% loss last week hit both individual investors who own 47% as well as institutions

Key Insights

• The considerable ownership by retail investors in DBAPPSecurity indicates that they collectively have a greater say in management and business strategy
• 51% of the business is held by the top 14 shareholders
• Insider ownership in DBAPPSecurity is 13%

If you want to know who really controls DBAPPSecurity Co., Ltd. (SHSE:688023), then you'll have to look at the makeup of its share registry. And the group that holds the biggest piece of the pie are retail investors with 47% ownership. Put another way, the group faces the maximum upside potential (or downside risk).

Following a 8.3% decrease in the stock price last week, retail investors suffered the most losses, but institutions who own 22% stock also took a hit.

Let's take a closer look to see what the different types of shareholders can tell us about DBAPPSecurity.

View our latest analysis for DBAPPSecurity

What Does The Institutional Ownership Tell Us About DBAPPSecurity?

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.

DBAPPSecurity already has institutions on the share registry. Indeed, they own a respectable stake in the company. 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. 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 DBAPPSecurity, (below). Of course, keep in mind that there are other factors to consider, too.

Hedge funds don't have many shares in DBAPPSecurity. Looking at our data, we can see that the largest shareholder is Yuan Fan with 13% of shares outstanding. Meanwhile, the second and third largest shareholders, hold 8.2% and 7.9%, of the shares outstanding, respectively.

A closer look at our ownership figures suggests that the top 14 shareholders have a combined ownership of 51% implying that no single shareholder has a majority.

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

Insider Ownership Of DBAPPSecurity

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.

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.

It seems insiders own a significant proportion of DBAPPSecurity Co., Ltd.. Insiders have a CN¥838m stake in this CN¥6.4b 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

The general public, who are usually individual investors, hold a 47% stake in DBAPPSecurity. 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 Equity Ownership

Private equity firms hold a 8.2% stake in DBAPPSecurity. This suggests they can be influential in key policy decisions. Some investors might be encouraged by this, since private equity are sometimes able to encourage strategies that help the market see the value in the company. Alternatively, those holders might be exiting the investment after taking it public.

Private Company Ownership

We can see that Private Companies own 9.5%, of the shares on issue. 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:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. Consider for instance, the ever-present spectre of investment risk. We've identified 1 warning sign with DBAPPSecurity , and understanding them should be part of your investment process.

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.