China Shineway Pharmaceutical Group Limited's (HKG:2877) Top Key Executive Zhenjiang Li is the most upbeat insider, and their holdings increased by 7.7% last week

Key Insights

• Insiders appear to have a vested interest in China Shineway Pharmaceutical Group's growth, as seen by their sizeable ownership
• Zhenjiang Li owns 72% of the company
• Using data from analyst forecasts alongside ownership research, one can better assess the future performance of a company

If you want to know who really controls China Shineway Pharmaceutical Group Limited (HKG:2877), 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 73% 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 a result, insiders scored the highest last week as the company hit HK$5.5b market cap following a 7.7% gain in the stock.

Let's take a closer look to see what the different types of shareholders can tell us about China Shineway Pharmaceutical Group.

See our latest analysis for China Shineway Pharmaceutical Group

What Does The Institutional Ownership Tell Us About China Shineway Pharmaceutical Group?

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.

We can see that China Shineway Pharmaceutical Group 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. When multiple institutions own a stock, there's always a risk that they are in a 'crowded trade'. When such a trade goes wrong, multiple parties may compete to sell stock fast. This risk is higher in a company without a history of growth. You can see China Shineway Pharmaceutical Group's historic earnings and revenue below, but keep in mind there's always more to the story.

Hedge funds don't have many shares in China Shineway Pharmaceutical Group. Our data suggests that Zhenjiang Li, who is also the company's Top Key Executive, holds the most number of shares at 72%. 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. For context, the second largest shareholder holds about 1.5% of the shares outstanding, followed by an ownership of 1.1% by the third-largest shareholder.

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. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.

Insider Ownership Of China Shineway Pharmaceutical Group

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 China Shineway Pharmaceutical Group Limited. This means they can collectively make decisions for the company. So they have a HK$4.0b stake in this HK$5.5b 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 22% stake in China Shineway Pharmaceutical Group. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.

Next Steps:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. Consider risks, for instance. Every company has them, and we've spotted 1 warning sign for China Shineway Pharmaceutical Group 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.