Recent 12% pullback would hurt Chengdu Galaxy Magnets Co.,Ltd. (SZSE:300127) insiders

Key Insights

• Chengdu Galaxy MagnetsLtd's significant insider ownership suggests inherent interests in company's expansion
• A total of 2 investors have a majority stake in the company with 61% ownership
• Using data from company's past performance alongside ownership research, one can better assess the future performance of a company

Every investor in Chengdu Galaxy Magnets Co.,Ltd. (SZSE:300127) should be aware of the most powerful shareholder groups. With 38% stake, individual insiders possess the maximum shares in the company. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

As a result, insiders as a group endured the highest losses after market cap fell by CN¥630m.

In the chart below, we zoom in on the different ownership groups of Chengdu Galaxy MagnetsLtd.

Check out our latest analysis for Chengdu Galaxy MagnetsLtd

What Does The Institutional Ownership Tell Us About Chengdu Galaxy MagnetsLtd?

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.

Institutions have a very small stake in Chengdu Galaxy MagnetsLtd. 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. We sometimes see a rising share price when a few big institutions want to buy a certain stock at the same time. The history of earnings and revenue, which you can see below, could be helpful in considering if more institutional investors will want the stock. Of course, there are plenty of other factors to consider, too.

Hedge funds don't have many shares in Chengdu Galaxy MagnetsLtd. Our data shows that Chengdu Galaxy Industrial Group Co., Ltd. is the largest shareholder with 31% of shares outstanding. Yan Dai is the second largest shareholder owning 31% of common stock, and Yan Zhang holds about 3.7% of the company stock. Yan Zhang, who is the third-largest shareholder, also happens to hold the title of Member of the Board of Directors. In addition, we found that Zhijian Wu, the CEO has 3.3% of the shares allocated to their name.

To make our study more interesting, we found that the top 2 shareholders have a majority ownership in the company, meaning that they are powerful enough to influence the decisions of the company.

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 is a little analyst coverage of the stock, but not much. So there is room for it to gain more coverage.

Insider Ownership Of Chengdu Galaxy MagnetsLtd

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. 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.

Most consider insider ownership a positive because it can indicate the board is well aligned with other shareholders. However, on some occasions too much power is concentrated within this group.

It seems insiders own a significant proportion of Chengdu Galaxy Magnets Co.,Ltd.. Insiders own CN¥1.8b worth of shares in the CN¥4.8b company. This may suggest that the founders still own a lot of shares. You can click here to see if they have been buying or selling.

General Public Ownership

The general public-- including retail investors -- own 28% stake in the company, and hence can't easily be ignored. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.

Private Company Ownership

We can see that Private Companies own 31%, 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 risks, for instance. Every company has them, and we've spotted 2 warning signs for Chengdu Galaxy MagnetsLtd you should know about.

If you would prefer discover what analysts are predicting in terms of future growth, do not miss this free report on analyst forecasts.

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.