The recent 12% gain must have brightened Top Key Executive Haijun Zhang's week, Hebei Yichen Industrial Group Corporation Limited's (HKG:1596) most bullish insider

Key Insights

• Insiders appear to have a vested interest in Hebei Yichen Industrial Group's growth, as seen by their sizeable ownership
• 50% of the business is held by the top 5 shareholders
• Using data from company's past performance alongside ownership research, one can better assess the future performance of a company

A look at the shareholders of Hebei Yichen Industrial Group Corporation Limited (HKG:1596) can tell us which group is most powerful. The group holding the most number of shares in the company, around 67% 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 HK$413m last week.

In the chart below, we zoom in on the different ownership groups of Hebei Yichen Industrial Group.

Check out our latest analysis for Hebei Yichen Industrial Group

What Does The Institutional Ownership Tell Us About Hebei Yichen Industrial Group?

Institutional investors commonly compare their own returns to the returns of a commonly followed index. So they generally do consider buying larger companies that are included in the relevant benchmark index.

Less than 5% of Hebei Yichen Industrial Group is held by institutional investors. This suggests that some funds have the company in their sights, but many have not yet bought shares in it. So if the company itself can improve over time, we may well see more institutional buyers in the future. We sometimes see a rising share price when a few big institutions want to buy a certain stock at the same time. The history of earnings and revenue, which you can see below, could be helpful in considering if more institutional investors will want the stock. Of course, there are plenty of other factors to consider, too.

Hebei Yichen Industrial Group is not owned by hedge funds. Our data suggests that Haijun Zhang, who is also the company's Top Key Executive, holds the most number of shares at 16%. 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. Xiaosuo Zhang is the second largest shareholder owning 11% of common stock, and Junxia Zhang holds about 9.3% of the company stock. Furthermore, CEO Lifeng Zhang is the owner of 1.8% of the company's shares.

To make our study more interesting, we found that the top 5 shareholders control more than half of the company which implies that this group has considerable sway over the company's decision-making.

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. As far as we can tell there isn't analyst coverage of the company, so it is probably flying under the radar.

Insider Ownership Of Hebei Yichen Industrial Group

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. Management ultimately answers to the board. However, it is not uncommon for managers to be executive board members, especially if they are a founder or the CEO.

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.

It seems that insiders own more than half the Hebei Yichen Industrial Group Corporation Limited stock. This gives them a lot of power. So they have a HK$2.5b stake in this HK$3.7b business. It is good to see this level of investment. You can check here to see if those insiders have been buying recently.

General Public Ownership

With a 21% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Hebei Yichen Industrial Group. 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

It seems that Private Companies own 6.5%, of the Hebei Yichen Industrial Group stock. 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.

Public Company Ownership

It appears to us that public companies own 3.5% of Hebei Yichen Industrial Group. We can't be certain but it is quite possible this is a strategic stake. The businesses may be similar, or work together.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Hebei Yichen Industrial Group better, we need to consider many other factors. Take risks for example - Hebei Yichen Industrial Group has 2 warning signs (and 1 which makes us a bit uncomfortable) we think you should know about.

Of course this may not be the best stock to buy. Therefore, you may wish to see our free collection of interesting prospects boasting favorable financials.

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.