Shenzhen Phoenix Telecom Technology Co.,Ltd.'s (SZSE:301191) CEO Longfa Chen is the most upbeat insider, and their holdings increased by 9.2% last week

Key Insights

• Shenzhen Phoenix Telecom TechnologyLtd's significant insider ownership suggests inherent interests in company's expansion
• The top 2 shareholders own 55% of the company
• Using data from analyst forecasts alongside ownership research, one can better assess the future performance of a company

Every investor in Shenzhen Phoenix Telecom Technology Co.,Ltd. (SZSE:301191) should be aware of the most powerful shareholder groups. We can see that individual insiders own the lion's share in the company with 63% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

As a result, insiders were the biggest beneficiaries of last week’s 9.2% gain.

Let's take a closer look to see what the different types of shareholders can tell us about Shenzhen Phoenix Telecom TechnologyLtd.

View our latest analysis for Shenzhen Phoenix Telecom TechnologyLtd

What Does The Institutional Ownership Tell Us About Shenzhen Phoenix Telecom TechnologyLtd?

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 Shenzhen Phoenix Telecom TechnologyLtd does have institutional investors; and they hold a good portion of the company's stock. 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. 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 Shenzhen Phoenix Telecom TechnologyLtd's earnings history below. Of course, the future is what really matters.

We note that hedge funds don't have a meaningful investment in Shenzhen Phoenix Telecom TechnologyLtd. The company's CEO Longfa Chen is the largest shareholder with 32% of shares outstanding. In comparison, the second and third largest shareholders hold about 22% and 6.4% of the stock.

After doing some more digging, we found that the top 2 shareholders collectively control more than half of the company's shares, implying that they have considerable power to influence the company's decisions.

While studying institutional ownership for a company can add value to your research, it is also a good practice to research analyst recommendations to get a deeper understand of a stock's expected performance. 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 Shenzhen Phoenix Telecom TechnologyLtd

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 information suggests that insiders own more than half of Shenzhen Phoenix Telecom Technology Co.,Ltd.. This gives them effective control of the company. So they have a CN¥4.5b stake in this CN¥7.2b business. Most would argue this is a positive, showing strong alignment with shareholders. You can click here to see if those insiders 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. This size of ownership, while considerable, may not be enough to change company policy if the decision is not in sync with other large shareholders.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Shenzhen Phoenix Telecom TechnologyLtd better, we need to consider many other factors. Consider for instance, the ever-present spectre of investment risk. We've identified 2 warning signs with Shenzhen Phoenix Telecom TechnologyLtd , and understanding them should be part of your investment process.

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.