Key Insights

• Zhejiang Garden BiopharmaceuticalLtd's significant individual investors ownership suggests that the key decisions are influenced by shareholders from the larger public
• A total of 25 investors have a majority stake in the company with 44% ownership
• Past performance of a company along with ownership data serve to give a strong idea about prospects for a business

Every investor in Zhejiang Garden Biopharmaceutical Co.,Ltd. (SZSE:300401) should be aware of the most powerful shareholder groups. And the group that holds the biggest piece of the pie are individual investors with 56% ownership. Put another way, the group faces the maximum upside potential (or downside risk).

As a result, individual investors collectively scored the highest last week as the company hit CN¥8.3b market cap following a 4.8% gain in the stock.

Let's take a closer look to see what the different types of shareholders can tell us about Zhejiang Garden BiopharmaceuticalLtd.

What Does The Institutional Ownership Tell Us About Zhejiang Garden BiopharmaceuticalLtd?

Institutions typically measure themselves against a benchmark when reporting to their own investors, so they often become more enthusiastic about a stock once it's included in a major index. We would expect most companies to have some institutions on the register, especially if they are growing.

Zhejiang Garden BiopharmaceuticalLtd already has institutions on the share registry. Indeed, they own a respectable stake in the company. 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. It is not uncommon to see a big share price drop if two large institutional investors try to sell out of a stock at the same time. So it is worth checking the past earnings trajectory of Zhejiang Garden BiopharmaceuticalLtd, (below). Of course, keep in mind that there are other factors to consider, too.

Zhejiang Garden BiopharmaceuticalLtd is not owned by hedge funds. Zhejiang Xiangyun Technology Co., Ltd. is currently the company's largest shareholder with 27% of shares outstanding. For context, the second largest shareholder holds about 3.8% of the shares outstanding, followed by an ownership of 3.1% by the third-largest shareholder. Furthermore, CEO Huanzheng Ma is the owner of 0.7% of the company's shares.

A deeper look at our ownership data shows that the top 25 shareholders collectively hold less than half of the register, suggesting a large group of small holders where no single shareholder has a majority.

While studying institutional ownership for a company can add value to your research, it is also a good practice to research analyst recommendations to get a deeper understand of a stock's expected performance. There is a little analyst coverage of the stock, but not much. So there is room for it to gain more coverage.

Insider Ownership Of Zhejiang Garden BiopharmaceuticalLtd

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.

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 some shares in Zhejiang Garden Biopharmaceutical Co.,Ltd.. This is a big company, so it is good to see this level of alignment. Insiders own CN¥480m worth of shares (at current prices). If you would like to explore the question of insider alignment, you can click here to see if insiders have been buying or selling.

General Public Ownership

The general public, mostly comprising of individual investors, collectively holds 56% of Zhejiang Garden BiopharmaceuticalLtd shares. This size of ownership gives investors from the general public some collective power. They can and probably do influence decisions on executive compensation, dividend policies and proposed business acquisitions.

Private Company Ownership

It seems that Private Companies own 27%, of the Zhejiang Garden BiopharmaceuticalLtd stock. 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 Zhejiang Garden BiopharmaceuticalLtd better, we need to consider many other factors. Consider for instance, the ever-present spectre of investment risk. We've identified 1 warning sign with Zhejiang Garden BiopharmaceuticalLtd , and understanding them should be part of your investment process.

If you would prefer discover what analysts are predicting in terms of future growth, do not miss this free report on analyst forecasts.

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.