With 68% ownership, Yealink Network Technology Co., Ltd. (SZSE:300628) insiders have a lot at stake

Key Insights

• Yealink Network Technology's significant insider ownership suggests inherent interests in company's expansion
• A total of 4 investors have a majority stake in the company with 56% ownership
• Institutional ownership in Yealink Network Technology is 11%

To get a sense of who is truly in control of Yealink Network Technology Co., Ltd. (SZSE:300628), it is important to understand the ownership structure of the business. We can see that individual insiders own the lion's share in the company with 68% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

So it follows, every decision made by insiders of Yealink Network Technology regarding the company's future would be crucial to them.

In the chart below, we zoom in on the different ownership groups of Yealink Network Technology.

Check out our latest analysis for Yealink Network Technology

What Does The Institutional Ownership Tell Us About Yealink Network Technology?

Institutions typically measure themselves against a benchmark when reporting to their own investors, so they often become more enthusiastic about a stock once it's included in a major index. We would expect most companies to have some institutions on the register, especially if they are growing.

We can see that Yealink Network Technology does have institutional investors; and they hold a good portion of the company's stock. 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. If multiple institutions change their view on a stock at the same time, you could see the share price drop fast. It's therefore worth looking at Yealink Network Technology's earnings history below. Of course, the future is what really matters.

We note that hedge funds don't have a meaningful investment in Yealink Network Technology. Our data suggests that Zhisong Chen, who is also the company's Chief Financial Officer, holds the most number of shares at 21%. When an insider holds a sizeable amount of a company's stock, investors consider it as a positive sign because it suggests that insiders are willing to have their wealth tied up in the future of the company. In comparison, the second and third largest shareholders hold about 17% and 10% of the stock. Interestingly, the third-largest shareholder, Rong Fu Lu is also a Member of the Board of Directors, again, indicating strong insider ownership amongst the company's top shareholders. In addition, we found that Lian Chang Zhang, the CEO has 4.7% of the shares allocated to their name.

On looking further, we found that 56% of the shares are owned by the top 4 shareholders. In other words, these shareholders have a meaningful say in the decisions of the company.

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. There are a reasonable number of analysts covering the stock, so it might be useful to find out their aggregate view on the future.

Insider Ownership Of Yealink Network Technology

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.

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.

Our most recent data indicates that insiders own the majority of Yealink Network Technology Co., Ltd.. This means they can collectively make decisions for the company. That means insiders have a very meaningful CN¥35b stake in this CN¥51b business. Most would be pleased to see the board is investing alongside them. You may wish to discover if they have been buying or selling.

General Public Ownership

The general public-- including retail investors -- own 15% stake in the company, and hence can't easily be ignored. 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.

Private Company Ownership

We can see that Private Companies own 5.0%, of the shares on issue. 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.

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 - Yealink Network Technology has 1 warning sign we think you should be aware of.

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.