Great week for Wuhan Jingce Electronic Group Co.,Ltd (SZSE:300567) institutional investors after losing 29% over the previous year

Key Insights

• Significantly high institutional ownership implies Wuhan Jingce Electronic GroupLtd's stock price is sensitive to their trading actions
• The top 6 shareholders own 51% of the company
• Insider ownership in Wuhan Jingce Electronic GroupLtd is 38%

If you want to know who really controls Wuhan Jingce Electronic Group Co.,Ltd (SZSE:300567), then you'll have to look at the makeup of its share registry. The group holding the most number of shares in the company, around 39% to be precise, is institutions. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

Institutional investors would appreciate the 13% increase in share price last week, given their one-year losses have totalled a disappointing 29%.

In the chart below, we zoom in on the different ownership groups of Wuhan Jingce Electronic GroupLtd.

View our latest analysis for Wuhan Jingce Electronic GroupLtd

What Does The Institutional Ownership Tell Us About Wuhan Jingce Electronic GroupLtd?

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.

Wuhan Jingce Electronic GroupLtd already has institutions on the share registry. Indeed, they own a respectable stake in the company. 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. 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 Wuhan Jingce Electronic GroupLtd'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 Wuhan Jingce Electronic GroupLtd. With a 26% stake, CEO Qian Peng is the largest shareholder. Kai Chen is the second largest shareholder owning 8.3% of common stock, and China Asset Management Co. Ltd. holds about 6.2% of the company stock.

We also observed that the top 6 shareholders account for more than half of the share register, with a few smaller shareholders to balance the interests of the larger ones to a certain extent.

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

Insider Ownership Of Wuhan Jingce Electronic GroupLtd

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. 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 information suggests that insiders maintain a significant holding in Wuhan Jingce Electronic Group Co.,Ltd. It has a market capitalization of just CN¥16b, and insiders have CN¥6.2b 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

With a 20% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Wuhan Jingce Electronic GroupLtd. 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. Case in point: We've spotted 2 warning signs for Wuhan Jingce Electronic GroupLtd you should be aware of.

If you are like me, you may want to think about whether this company will grow or shrink. Luckily, you can check this free report showing analyst forecasts for its future.

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