Head of Sales Chunbao Shi, Beijing Chunlizhengda Medical Instruments Co., Ltd.'s (HKG:1858) largest shareholder sees value of holdings go down 12% after recent drop

Key Insights

• Insiders appear to have a vested interest in Beijing Chunlizhengda Medical Instruments' growth, as seen by their sizeable ownership
• 55% of the business is held by the top 2 shareholders
• Institutions own 21% of Beijing Chunlizhengda Medical Instruments

If you want to know who really controls Beijing Chunlizhengda Medical Instruments Co., Ltd. (HKG:1858), 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 58% to be precise, is individual insiders. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

As market cap fell to HK$4.3b last week, insiders would have faced the highest losses than any other shareholder groups of the company.

Let's delve deeper into each type of owner of Beijing Chunlizhengda Medical Instruments, beginning with the chart below.

Check out our latest analysis for Beijing Chunlizhengda Medical Instruments

What Does The Institutional Ownership Tell Us About Beijing Chunlizhengda Medical Instruments?

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.

Beijing Chunlizhengda Medical Instruments already has institutions on the share registry. Indeed, they own a respectable stake in the company. 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 Beijing Chunlizhengda Medical Instruments' earnings history below. Of course, the future is what really matters.

Beijing Chunlizhengda Medical Instruments is not owned by hedge funds. Because actions speak louder than words, we consider it a good sign when insiders own a significant stake in a company. In Beijing Chunlizhengda Medical Instruments' case, its Head of Sales, Chunbao Shi, is the largest shareholder, holding 30% of shares outstanding. For context, the second largest shareholder holds about 25% of the shares outstanding, followed by an ownership of 4.5% by the third-largest shareholder. Interestingly, the second-largest shareholder, Shujun Yue is also Senior Key Executive, again, pointing towards strong insider ownership amongst the company's top shareholders.

A more detailed study of the shareholder registry showed us that 2 of the top shareholders have a considerable amount of ownership in the company, via their 55% 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 a little analyst coverage of the stock, but not much. So there is room for it to gain more coverage.

Insider Ownership Of Beijing Chunlizhengda Medical Instruments

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.

Insider ownership is positive when it signals leadership are thinking like the true owners of the company. However, high insider ownership can also give immense power to a small group within the company. This can be negative in some circumstances.

Our most recent data indicates that insiders own the majority of Beijing Chunlizhengda Medical Instruments Co., Ltd.. This means they can collectively make decisions for the company. Given it has a market cap of HK$4.3b, that means they have HK$2.5b worth of shares. 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 20% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Beijing Chunlizhengda Medical Instruments. 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:

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. To that end, you should be aware of the 1 warning sign we've spotted with Beijing Chunlizhengda Medical Instruments .

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.