The recent 11% gain must have brightened Senior Key Executive Jianchun Zhang's week, Zhejiang ZUCH Technology Co., Ltd's (SZSE:301280) most bullish insider

Key Insights

• Significant insider control over Zhejiang ZUCH Technology implies vested interests in company growth
• 56% of the business is held by the top 3 shareholders
• Institutional ownership in Zhejiang ZUCH Technology is 11%

If you want to know who really controls Zhejiang ZUCH Technology Co., Ltd (SZSE:301280), 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 66% to be precise, is individual insiders. Put another way, the group faces the maximum upside potential (or downside risk).

Clearly, insiders benefitted the most after the company's market cap rose by CN¥419m last week.

Let's take a closer look to see what the different types of shareholders can tell us about Zhejiang ZUCH Technology.

View our latest analysis for Zhejiang ZUCH Technology

What Does The Institutional Ownership Tell Us About Zhejiang ZUCH 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.

Zhejiang ZUCH Technology 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 Zhejiang ZUCH Technology, (below). Of course, keep in mind that there are other factors to consider, too.

Zhejiang ZUCH Technology is not owned by hedge funds. Our data suggests that Jianchun Zhang, who is also the company's Senior Key Executive, holds the most number of shares at 19%. 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. With 19% and 17% of the shares outstanding respectively, Jiandao Zhang and Shile Shi are the second and third largest shareholders. Interestingly, the third-largest shareholder, Shile Shi is also a Member of the Board of Directors, again, indicating strong insider ownership amongst the company's top shareholders.

A more detailed study of the shareholder registry showed us that 3 of the top shareholders have a considerable amount of ownership in the company, via their 56% stake.

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 is some analyst coverage of the stock, but it could still become more well known, with time.

Insider Ownership Of Zhejiang ZUCH Technology

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.

I generally consider insider ownership to be a good thing. However, on some occasions it makes it more difficult for other shareholders to hold the board accountable for decisions.

Our most recent data indicates that insiders own the majority of Zhejiang ZUCH Technology Co., Ltd. This means they can collectively make decisions for the company. So they have a CN¥2.8b stake in this CN¥4.2b business. Most would be pleased to see the board is investing alongside them. You may wish todiscover (for free) if they have been buying or selling.

General Public Ownership

The general public, who are usually individual investors, hold a 14% stake in Zhejiang ZUCH Technology. 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 7.1%, of the company's shares. It might be worth looking deeper into this. If related parties, such as insiders, have an interest in one of these private companies, that should be disclosed in the annual report. Private companies may also have a strategic interest in the company.

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 - Zhejiang ZUCH Technology has 2 warning signs (and 1 which is a bit concerning) we think you should know about.

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.