Key Insights

• Significant insider control over ZJLD Group implies vested interests in company growth
• 67% of the company is held by a single shareholder (Xiangdong Wu)
• Insiders have sold recently

Every investor in ZJLD Group Inc (HKG:6979) should be aware of the most powerful shareholder groups. And the group that holds the biggest piece of the pie are individual insiders with 68% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

Despite selling some shares recently, insiders control a good portion of the company's stock.

In the chart below, we zoom in on the different ownership groups of ZJLD Group.

What Does The Institutional Ownership Tell Us About ZJLD 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.

Institutions have a very small stake in ZJLD Group. That indicates that the company is on the radar of some funds, but it isn't particularly popular with professional investors at the moment. If the company is growing earnings, that may indicate that it is just beginning to catch the attention of these deep-pocketed investors. It is not uncommon to see a big share price rise if multiple institutional investors are trying to buy into a stock at the same time. So check out the historic earnings trajectory, below, but keep in mind it's the future that counts most.

Hedge funds don't have many shares in ZJLD Group. Because actions speak louder than words, we consider it a good sign when insiders own a significant stake in a company. In ZJLD Group's case, its Top Key Executive, Xiangdong Wu, is the largest shareholder, holding 67% of shares outstanding. For context, the second largest shareholder holds about 13% of the shares outstanding, followed by an ownership of 1.8% by the third-largest shareholder. Interestingly, the third-largest shareholder, Kwong Chue Ng is also a Member of the Board of Directors, again, indicating strong insider ownership amongst the company's top shareholders.

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. There are plenty of analysts covering the stock, so it might be worth seeing what they are forecasting, too.

Insider Ownership Of ZJLD 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. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.

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 information suggests that insiders own more than half of ZJLD Group Inc. This gives them effective control of the company. That means insiders have a very meaningful HK$18b stake in this HK$27b business. Most would be pleased to see the board is investing alongside them. You may wish to discover if they have been buying or selling.

General Public Ownership

With a 15% ownership, the general public, mostly comprising of individual investors, have some degree of sway over ZJLD Group. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.

Private Equity Ownership

With a stake of 13%, private equity firms could influence the ZJLD Group board. Sometimes we see private equity stick around for the long term, but generally speaking they have a shorter investment horizon and -- as the name suggests -- don't invest in public companies much. After some time they may look to sell and redeploy capital elsewhere.

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. Take risks for example - ZJLD Group has 3 warning signs (and 1 which can't be ignored) we think you should know about.

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