Private companies invested in Jiangxi Everbright Measurement And Control Technology Co.,Ltd. (SZSE:300906) copped the brunt of last week's CN¥266m market cap decline

Key Insights

• Significant control over Jiangxi Everbright Measurement And Control TechnologyLtd by private companies implies that the general public has more power to influence management and governance-related decisions
• The top 2 shareholders own 55% of the company
• Insider ownership in Jiangxi Everbright Measurement And Control TechnologyLtd is 18%

Every investor in Jiangxi Everbright Measurement And Control Technology Co.,Ltd. (SZSE:300906) should be aware of the most powerful shareholder groups. The group holding the most number of shares in the company, around 39% to be precise, is private companies. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

As a result, private companies as a group endured the highest losses last week after market cap fell by CN¥266m.

Let's take a closer look to see what the different types of shareholders can tell us about Jiangxi Everbright Measurement And Control TechnologyLtd.

Check out our latest analysis for Jiangxi Everbright Measurement And Control TechnologyLtd

What Does The Institutional Ownership Tell Us About Jiangxi Everbright Measurement And Control TechnologyLtd?

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.

Jiangxi Everbright Measurement And Control TechnologyLtd 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. It is not uncommon to see a big share price drop if two large institutional investors try to sell out of a stock at the same time. So it is worth checking the past earnings trajectory of Jiangxi Everbright Measurement And Control TechnologyLtd, (below). Of course, keep in mind that there are other factors to consider, too.

We note that hedge funds don't have a meaningful investment in Jiangxi Everbright Measurement And Control TechnologyLtd. Our data shows that Jiangxi Everbright Industry Co., Ltd. is the largest shareholder with 39% of shares outstanding. In comparison, the second and third largest shareholders hold about 15% and 3.8% of the stock. Jie Tao, who is the second-largest shareholder, also happens to hold the title of Chief Executive Officer.

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. 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 Jiangxi Everbright Measurement And Control TechnologyLtd

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.

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 information suggests that insiders maintain a significant holding in Jiangxi Everbright Measurement And Control Technology Co.,Ltd.. Insiders own CN¥343m worth of shares in the CN¥2.0b 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, who are usually individual investors, hold a 34% stake in Jiangxi Everbright Measurement And Control TechnologyLtd. 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

Our data indicates that Private Companies hold 39%, of the company's shares. It's hard to draw any conclusions from this fact alone, so its worth looking into who owns those private companies. Sometimes insiders or other related parties have an interest in shares in a public company through a separate private company.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Jiangxi Everbright Measurement And Control TechnologyLtd better, we need to consider many other factors. Take risks for example - Jiangxi Everbright Measurement And Control TechnologyLtd has 2 warning signs (and 1 which is significant) we think you should know about.

Of course this may not be the best stock to buy. So take a peek at this free free list of interesting companies.

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.