Key Insights

• Significant insider control over Poly Plastic Masterbatch (SuZhou)Ltd implies vested interests in company growth
• A total of 4 investors have a majority stake in the company with 52% ownership
• Ownership research, combined with past performance data can help provide a good understanding of opportunities in a stock

Every investor in Poly Plastic Masterbatch (SuZhou) Co.,Ltd (SZSE:300905) should be aware of the most powerful shareholder groups. And the group that holds the biggest piece of the pie are individual insiders with 37% ownership. Put another way, the group faces the maximum upside potential (or downside risk).

As market cap fell to CN¥5.0b last week, insiders would have faced the highest losses than any other shareholder groups of the company.

Let's take a closer look to see what the different types of shareholders can tell us about Poly Plastic Masterbatch (SuZhou)Ltd.

What Does The Institutional Ownership Tell Us About Poly Plastic Masterbatch (SuZhou)Ltd?

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 Poly Plastic Masterbatch (SuZhou)Ltd does have institutional investors; and they hold a good portion of the company's stock. This suggests some credibility amongst professional investors. But we can't rely on that fact alone since institutions make bad investments sometimes, just like everyone does. 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 Poly Plastic Masterbatch (SuZhou)Ltd's earnings history below. Of course, the future is what really matters.

Hedge funds don't have many shares in Poly Plastic Masterbatch (SuZhou)Ltd. Wenda Xu is currently the largest shareholder, with 22% of shares outstanding. Suzhou Juxingbao Electronic Technology Co., Ltd. is the second largest shareholder owning 18% of common stock, and Yiming Xu holds about 6.2% of the company stock. Yiming Xu, who is the third-largest shareholder, also happens to hold the title of Chairman of the Board. Additionally, the company's CEO Fuming Gong directly holds 1.6% of the total shares outstanding.

Our research also brought to light the fact that roughly 52% of the company is controlled by the top 4 shareholders suggesting that these owners wield significant influence on the business.

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 Poly Plastic Masterbatch (SuZhou)Ltd

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.

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.

It seems insiders own a significant proportion of Poly Plastic Masterbatch (SuZhou) Co.,Ltd. It has a market capitalization of just CN¥5.0b, and insiders have CN¥1.9b worth of shares in their own names. This may suggest that the founders still own a lot of shares. You can click here to see if they have been buying or selling.

General Public Ownership

With a 31% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Poly Plastic Masterbatch (SuZhou)Ltd. 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.

Private Company Ownership

Our data indicates that Private Companies hold 24%, 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:

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. For instance, we've identified 3 warning signs for Poly Plastic Masterbatch (SuZhou)Ltd (2 are significant) that you should be aware of.

If you would prefer check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, backed by strong financial data.

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.