Fujian Torch Electron Technology Co., Ltd. (SHSE:603678) adds CN¥442m in market cap and insiders have a 42% stake in that gain

Key Insights

• Insiders appear to have a vested interest in Fujian Torch Electron Technology's growth, as seen by their sizeable ownership
• A total of 4 investors have a majority stake in the company with 52% ownership
• 19% of Fujian Torch Electron Technology is held by Institutions

A look at the shareholders of Fujian Torch Electron Technology Co., Ltd. (SHSE:603678) can tell us which group is most powerful. And the group that holds the biggest piece of the pie are individual insiders with 42% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

As a result, insiders were the biggest beneficiaries of last week’s 3.9% gain.

Let's delve deeper into each type of owner of Fujian Torch Electron Technology, beginning with the chart below.

View our latest analysis for Fujian Torch Electron Technology

What Does The Institutional Ownership Tell Us About Fujian Torch Electron Technology?

Many institutions measure their performance against an index that approximates the local market. So they usually pay more attention to companies that are included in major indices.

We can see that Fujian Torch Electron Technology does have institutional investors; and they hold a good portion of the company's stock. This can indicate that the company has a certain degree of credibility in the investment community. However, it is best to be wary of relying on the supposed validation that comes with institutional investors. They too, get it wrong sometimes. 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 Fujian Torch Electron Technology, (below). Of course, keep in mind that there are other factors to consider, too.

Hedge funds don't have many shares in Fujian Torch Electron Technology. Looking at our data, we can see that the largest shareholder is Mingtong Cai with 37% of shares outstanding. In comparison, the second and third largest shareholders hold about 7.7% and 5.5% of the stock. JinJun Cai, who is the third-largest shareholder, also happens to hold the title of Chairman of the Board.

Our research also brought to light the fact that roughly 52% of the company is controlled by the top 4 shareholders suggesting that these owners wield significant influence on the business.

While studying institutional ownership for a company can add value to your research, it is also a good practice to research analyst recommendations to get a deeper understand of a stock's expected performance. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.

Insider Ownership Of Fujian Torch Electron Technology

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.

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 Fujian Torch Electron Technology Co., Ltd.. It has a market capitalization of just CN¥12b, and insiders have CN¥5.0b worth of shares in their own names. That's quite significant. Most would be pleased to see the board is investing alongside them. You may wish to access this free chart showing recent trading by insiders.

General Public Ownership

The general public, who are usually individual investors, hold a 38% stake in Fujian Torch Electron Technology. 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.

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. To that end, you should be aware of the 1 warning sign we've spotted with Fujian Torch Electron Technology .

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.