Fengzhushou Co., Ltd.'s (SZSE:301382) market cap rose CN¥614m last week; retail investors who hold 42% profited and so did insiders

Key Insights

• Significant control over Fengzhushou by retail investors implies that the general public has more power to influence management and governance-related decisions
• 52% of the business is held by the top 6 shareholders
• Insider ownership in Fengzhushou is 23%

A look at the shareholders of Fengzhushou Co., Ltd. (SZSE:301382) can tell us which group is most powerful. We can see that retail investors own the lion's share in the company with 42% ownership. Put another way, the group faces the maximum upside potential (or downside risk).

While retail investors were the group that reaped the most benefits after last week’s 9.7% price gain, insiders also received a 23% cut.

In the chart below, we zoom in on the different ownership groups of Fengzhushou.

See our latest analysis for Fengzhushou

What Does The Institutional Ownership Tell Us About Fengzhushou?

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.

Institutions have a very small stake in Fengzhushou. That indicates that the company is on the radar of some funds, but it isn't particularly popular with professional investors at the moment. If the business gets stronger from here, we could see a situation where more institutions are keen to buy. 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.

Fengzhushou is not owned by hedge funds. Our data shows that Hongpeng Luo is the largest shareholder with 22% of shares outstanding. In comparison, the second and third largest shareholders hold about 13% and 6.0% of the stock.

We did some more digging and found that 6 of the top shareholders account for roughly 52% of the register, implying that along with larger shareholders, there are a few smaller shareholders, thereby balancing out each others interests somewhat.

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. As far as we can tell there isn't analyst coverage of the company, so it is probably flying under the radar.

Insider Ownership Of Fengzhushou

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.

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 Fengzhushou Co., Ltd.. Insiders own CN¥1.6b worth of shares in the CN¥7.0b company. 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

The general public, who are usually individual investors, hold a 42% stake in Fengzhushou. 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

We can see that Private Companies own 15%, of the shares on issue. 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.

Public Company Ownership

It appears to us that public companies own 13% of Fengzhushou. We can't be certain but it is quite possible this is a strategic stake. The businesses may be similar, or work together.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Fengzhushou better, we need to consider many other factors. Case in point: We've spotted 2 warning signs for Fengzhushou you should be aware of.

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this 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.