Retail investors among Hua Ying Technology (Gruop) Co., Ltd.'s (SZSE:000536) largest stockholders and were hit after last week's 7.4% price drop

Key Insights

• Significant control over Hua Ying Technology (Gruop) by retail investors implies that the general public has more power to influence management and governance-related decisions
• 51% of the business is held by the top 5 shareholders
• Past performance of a company along with ownership data serve to give a strong idea about prospects for a business

Every investor in Hua Ying Technology (Gruop) Co., Ltd. (SZSE:000536) should be aware of the most powerful shareholder groups. With 45% stake, retail investors possess the maximum shares in the company. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

As market cap fell to CN¥5.2b last week, retail investors would have faced the highest losses than any other shareholder groups of the company.

Let's delve deeper into each type of owner of Hua Ying Technology (Gruop), beginning with the chart below.

See our latest analysis for Hua Ying Technology (Gruop)

What Does The Institutional Ownership Tell Us About Hua Ying Technology (Gruop)?

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.

Hua Ying Technology (Gruop) already has institutions on the share registry. Indeed, they own a respectable stake in the company. This suggests some credibility amongst professional investors. But we can't rely on that fact alone since institutions make bad investments sometimes, just like everyone does. When multiple institutions own a stock, there's always a risk that they are in a 'crowded trade'. When such a trade goes wrong, multiple parties may compete to sell stock fast. This risk is higher in a company without a history of growth. You can see Hua Ying Technology (Gruop)'s historic earnings and revenue below, but keep in mind there's always more to the story.

Hedge funds don't have many shares in Hua Ying Technology (Gruop). Fujian Electronics and Information Industry Equity Investment Management Co., Ltd. is currently the company's largest shareholder with 14% of shares outstanding. Putian State-owned Assets Investment Co., Ltd. is the second largest shareholder owning 14% of common stock, and Fujian Electronics & Information (Group) Co.,Ltd holds about 11% of the company stock.

Our research also brought to light the fact that roughly 51% of the company is controlled by the top 5 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. 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 Hua Ying Technology (Gruop)

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. Management ultimately answers to the board. However, it is not uncommon for managers to be executive board members, especially if they are a founder or the CEO.

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.

Our data cannot confirm that board members are holding shares personally. It is unusual not to have at least some personal holdings by board members, so our data might be flawed. A good next step would be to check how much the CEO is paid.

General Public Ownership

With a 45% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Hua Ying Technology (Gruop). While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.

Private Equity Ownership

With an ownership of 14%, private equity firms are in a position to play a role in shaping corporate strategy with a focus on value creation. Sometimes we see private equity stick around for the long term, but generally speaking they have a shorter investment horizon and -- as the name suggests -- don't invest in public companies much. After some time they may look to sell and redeploy capital elsewhere.

Private Company Ownership

Our data indicates that Private Companies hold 25%, of the company's shares. 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

It appears to us that public companies own 9.1% of Hua Ying Technology (Gruop). 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:

While it is well worth considering the different groups that own a company, there are other factors that are even more important.

Many find it useful to take an in depth look at how a company has performed in the past. You can access this detailed graph of past earnings, revenue and cash flow.

Of course this may not be the best stock to buy. Therefore, you may wish to see our free collection of interesting prospects boasting favorable financials.

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com