Key Insights

• The considerable ownership by individual investors in Smartsens Technology (Shanghai) indicates that they collectively have a greater say in management and business strategy
• 50% of the business is held by the top 8 shareholders
• 24% of Smartsens Technology (Shanghai) is held by insiders

Every investor in Smartsens Technology (Shanghai) Co., Ltd. (SHSE:688213) should be aware of the most powerful shareholder groups. We can see that individual investors own the lion's share in the company with 29% ownership. Put another way, the group faces the maximum upside potential (or downside risk).

While the holdings of individual investors took a hit after last week's 4.3% price drop, insiders with their 24% also suffered.

In the chart below, we zoom in on the different ownership groups of Smartsens Technology (Shanghai).

What Does The Institutional Ownership Tell Us About Smartsens Technology (Shanghai)?

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 Smartsens Technology (Shanghai) does have institutional investors; and they hold a good portion of the company's stock. This can indicate that the company has a certain degree of credibility in the investment community. However, it is best to be wary of relying on the supposed validation that comes with institutional investors. They too, get it wrong sometimes. 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 Smartsens Technology (Shanghai)'s earnings history below. Of course, the future is what really matters.

Hedge funds don't have many shares in Smartsens Technology (Shanghai). With a 14% stake, CEO Chen Xu is the largest shareholder. With 7.4% and 6.2% of the shares outstanding respectively, Huaxin Investment Management Co., Ltd. and Brizan China Holdings Limited are the second and third largest shareholders.

We also observed that the top 8 shareholders account for more than half of the share register, with a few smaller shareholders to balance the interests of the larger ones to a certain extent.

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

Insider Ownership Of Smartsens Technology (Shanghai)

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.

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 a reasonable proportion of Smartsens Technology (Shanghai) Co., Ltd.. It is very interesting to see that insiders have a meaningful CN¥4.6b stake in this CN¥19b business. Most would say this shows a good degree of alignment with shareholders, especially in a company of this size. You can click here to see if those insiders have been buying or selling.

General Public Ownership

The general public-- including retail investors -- own 29% stake in the company, and hence can't easily be ignored. 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 Equity Ownership

Private equity firms hold a 7.4% stake in Smartsens Technology (Shanghai). This suggests they can be influential in key policy decisions. Some might like this, because private equity are sometimes activists who hold management accountable. But other times, private equity is selling out, having taking the company public.

Private Company Ownership

Our data indicates that Private Companies hold 23%, of the company's shares. Private companies may be related parties. Sometimes insiders have an interest in a public company through a holding in a private company, rather than in their own capacity as an individual. While it's hard to draw any broad stroke conclusions, it is worth noting as an area for further research.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Smartsens Technology (Shanghai) better, we need to consider many other factors. Case in point: We've spotted 1 warning sign for Smartsens Technology (Shanghai) you should be aware of.

Ultimately the future is most important. You can access this free report on analyst forecasts for the company.

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.

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