Big Tree Cloud Holdings Limited's (NASDAQ:DSY) most bullish insider is CEO Wenquan Zhu, and their holdings value went up by 172% last week

Key Insights

• Big Tree Cloud Holdings' significant insider ownership suggests inherent interests in company's expansion
• 88% of the company is held by a single shareholder (Wenquan Zhu)
• Using data from company's past performance alongside ownership research, one can better assess the future performance of a company

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A look at the shareholders of Big Tree Cloud Holdings Limited (NASDAQ:DSY) can tell us which group is most powerful. The group holding the most number of shares in the company, around 88% 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 US$99m last week.

Let's take a closer look to see what the different types of shareholders can tell us about Big Tree Cloud Holdings.

See our latest analysis for Big Tree Cloud Holdings

What Does The Lack Of Institutional Ownership Tell Us About Big Tree Cloud Holdings?

Small companies that are not very actively traded often lack institutional investors, but it's less common to see large companies without them.

There could be various reasons why no institutions own shares in a company. Typically, small, newly listed companies don't attract much attention from fund managers, because it would not be possible for large fund managers to build a meaningful position in the company. It is also possible that fund managers don't own the stock because they aren't convinced it will perform well. Big Tree Cloud Holdings might not have the sort of past performance institutions are looking for, or perhaps they simply have not studied the business closely.

Hedge funds don't have many shares in Big Tree Cloud Holdings. With a 88% stake, CEO Wenquan Zhu is the largest shareholder. This essentially means that they have significant control over the outcome or future of the company, which is why insider ownership is usually looked upon favourably by prospective buyers. For context, the second largest shareholder holds about 0.04% of the shares outstanding, followed by an ownership of 0.02% 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. Our information suggests that there isn't any analyst coverage of the stock, so it is probably little known.

Insider Ownership Of Big Tree Cloud Holdings

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.

Our most recent data indicates that insiders own the majority of Big Tree Cloud Holdings Limited. This means they can collectively make decisions for the company. That means they own US$138m worth of shares in the US$157m company. That's quite meaningful. 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 12% stake in Big Tree Cloud Holdings. 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.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Big Tree Cloud Holdings better, we need to consider many other factors. Consider for instance, the ever-present spectre of investment risk. We've identified 4 warning signs with Big Tree Cloud Holdings (at least 3 which are concerning) , and understanding them should be part of your investment process.

Of course this may not be the best stock to buy. So take a peek at this free free list of interesting companies.

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.