Key Insights

• Insiders appear to have a vested interest in Jiangxi Yuean Advanced MaterialsLtd's growth, as seen by their sizeable ownership
• A total of 6 investors have a majority stake in the company with 52% ownership
• Using data from company's past performance alongside ownership research, one can better assess the future performance of a company

A look at the shareholders of Jiangxi Yuean Advanced Materials Co.,Ltd. (SHSE:688786) can tell us which group is most powerful. And the group that holds the biggest piece of the pie are individual insiders with 42% ownership. Put another way, the group faces the maximum upside potential (or downside risk).

As a result, insiders were the biggest beneficiaries of last week's 14% gain.

Let's take a closer look to see what the different types of shareholders can tell us about Jiangxi Yuean Advanced MaterialsLtd.

What Does The Institutional Ownership Tell Us About Jiangxi Yuean Advanced MaterialsLtd?

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.

As you can see, institutional investors have a fair amount of stake in Jiangxi Yuean Advanced MaterialsLtd. 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. When multiple institutions own a stock, there's always a risk that they are in a 'crowded trade'. When such a trade goes wrong, multiple parties may compete to sell stock fast. This risk is higher in a company without a history of growth. You can see Jiangxi Yuean Advanced MaterialsLtd's historic earnings and revenue below, but keep in mind there's always more to the story.

Hedge funds don't have many shares in Jiangxi Yuean Advanced MaterialsLtd. Our data suggests that Shangkui Li, who is also the company's Top Key Executive, holds the most number of shares at 27%. When an insider holds a sizeable amount of a company's stock, investors consider it as a positive sign because it suggests that insiders are willing to have their wealth tied up in the future of the company. With 9.6% and 6.3% of the shares outstanding respectively, Yunbao Yu and Shenzhen Decai Fund Management Co., Ltd. are the second and third largest shareholders. Interestingly, the second-largest shareholder, Yunbao Yu is also Senior Key Executive, again, pointing towards strong insider ownership amongst the company's top shareholders. Additionally, the company's CEO Bing Wang directly holds 2.2% of the total shares outstanding.

We also observed that the top 6 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. While there is some analyst coverage, the company is probably not widely covered. So it could gain more attention, down the track.

Insider Ownership Of Jiangxi Yuean Advanced MaterialsLtd

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.

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 information suggests that insiders maintain a significant holding in Jiangxi Yuean Advanced Materials Co.,Ltd.. Insiders have a CN¥1.4b stake in this CN¥3.4b business. It is great to see insiders so invested in the business. It might be worth checking if those insiders have been buying recently.

General Public Ownership

The general public, who are usually individual investors, hold a 37% stake in Jiangxi Yuean Advanced MaterialsLtd. 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

With an ownership of 6.3%, private equity firms are in a position to play a role in shaping corporate strategy with a focus on value creation. Some investors might be encouraged by this, since private equity are sometimes able to encourage strategies that help the market see the value in the company. Alternatively, those holders might be exiting the investment after taking it public.

Private Company Ownership

It seems that Private Companies own 6.6%, of the Jiangxi Yuean Advanced MaterialsLtd 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 Jiangxi Yuean Advanced MaterialsLtd better, we need to consider many other factors. For instance, we've identified 2 warning signs for Jiangxi Yuean Advanced MaterialsLtd (1 is a bit unpleasant) that you should be aware of.

If you are like me, you may want to think about whether this company will grow or shrink. Luckily, you can check this free report showing analyst forecasts for its future.

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.

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