Retail investors who hold 57% of Shenzhen Longood Intelligent Electric Co.,LTD (SZSE:300543) gained 12%, insiders profited as well

Key Insights

• Shenzhen Longood Intelligent ElectricLTD's significant retail investors ownership suggests that the key decisions are influenced by shareholders from the larger public
• The top 25 shareholders own 43% of the company
• Insiders own 40% of Shenzhen Longood Intelligent ElectricLTD

If you want to know who really controls Shenzhen Longood Intelligent Electric Co.,LTD (SZSE:300543), then you'll have to look at the makeup of its share registry. We can see that retail investors own the lion's share in the company with 57% 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 12% price gain, insiders also received a 40% cut.

Let's take a closer look to see what the different types of shareholders can tell us about Shenzhen Longood Intelligent ElectricLTD.

View our latest analysis for Shenzhen Longood Intelligent ElectricLTD

What Does The Institutional Ownership Tell Us About Shenzhen Longood Intelligent ElectricLTD?

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.

Institutions have a very small stake in Shenzhen Longood Intelligent ElectricLTD. 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 company is growing earnings, that may indicate that it is just beginning to catch the attention of these deep-pocketed investors. 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 Shenzhen Longood Intelligent ElectricLTD. The company's CEO Jing Chen is the largest shareholder with 22% of shares outstanding. In comparison, the second and third largest shareholders hold about 4.6% and 4.5% of the stock. Interestingly, the third-largest shareholder, Peiran Liu is also a Member of the Board of Directors, again, indicating strong insider ownership amongst the company's top shareholders.

Our studies suggest that the top 25 shareholders collectively control less than half of the company's shares, meaning that the company's shares are widely disseminated and there is no dominant shareholder.

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 Shenzhen Longood Intelligent ElectricLTD

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.

Our most recent data indicates that insiders own a reasonable proportion of Shenzhen Longood Intelligent Electric Co.,LTD. Insiders have a CN¥1.1b stake in this CN¥2.9b business. 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 57% of Shenzhen Longood Intelligent ElectricLTD. This size of ownership gives investors from the general public some collective power. They can and probably do influence decisions on executive compensation, dividend policies and proposed business acquisitions.

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. Take risks for example - Shenzhen Longood Intelligent ElectricLTD has 3 warning signs (and 1 which shouldn't be ignored) we think you should know about.

If you would prefer check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, backed by strong financial data.

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.