Zhejiang Lante Optics Co., Ltd.'s (SHSE:688127) CEO Yunming Xu is the most upbeat insider, and their holdings increased by 8.5% last week

Key Insights

• Zhejiang Lante Optics' significant insider ownership suggests inherent interests in company's expansion
• 51% of the business is held by the top 2 shareholders
• 14% of Zhejiang Lante Optics is held by Institutions

A look at the shareholders of Zhejiang Lante Optics Co., Ltd. (SHSE:688127) can tell us which group is most powerful. The group holding the most number of shares in the company, around 55% to be precise, is individual insiders. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

As a result, insiders scored the highest last week as the company hit CN¥11b market cap following a 8.5% gain in the stock.

Let's delve deeper into each type of owner of Zhejiang Lante Optics, beginning with the chart below.

View our latest analysis for Zhejiang Lante Optics

What Does The Institutional Ownership Tell Us About Zhejiang Lante Optics?

Institutional investors commonly compare their own returns to the returns of a commonly followed index. So they generally do consider buying larger companies that are included in the relevant benchmark index.

As you can see, institutional investors have a fair amount of stake in Zhejiang Lante Optics. 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 Zhejiang Lante Optics, (below). Of course, keep in mind that there are other factors to consider, too.

We note that hedge funds don't have a meaningful investment in Zhejiang Lante Optics. The company's CEO Yunming Xu is the largest shareholder with 37% of shares outstanding. In comparison, the second and third largest shareholders hold about 13% and 2.1% of the stock.

After doing some more digging, we found that the top 2 shareholders collectively control more than half of the company's shares, implying that they have considerable power to influence the company's decisions.

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. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.

Insider Ownership Of Zhejiang Lante Optics

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 that insiders own more than half the Zhejiang Lante Optics Co., Ltd. stock. This gives them a lot of power. Given it has a market cap of CN¥11b, that means insiders have a whopping CN¥5.9b worth of shares in their own names. Most would argue this is a positive, showing strong alignment with shareholders. You can click here to see if they have been selling down their stake.

General Public Ownership

The general public, who are usually individual investors, hold a 31% stake in Zhejiang Lante Optics. 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:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. Consider risks, for instance. Every company has them, and we've spotted 1 warning sign for Zhejiang Lante Optics you should know about.

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.