Key Insights

• The considerable ownership by private companies in Ecovacs Robotics indicates that they collectively have a greater say in management and business strategy
• A total of 2 investors have a majority stake in the company with 57% ownership
• Insider ownership in Ecovacs Robotics is 27%

If you want to know who really controls Ecovacs Robotics Co., Ltd. (SHSE:603486), then you'll have to look at the makeup of its share registry. We can see that private companies own the lion's share in the company with 43% ownership. Put another way, the group faces the maximum upside potential (or downside risk).

While insiders who own 27% came under pressure after market cap dropped to CN¥24b last week,private companies took the most losses.

Let's delve deeper into each type of owner of Ecovacs Robotics, beginning with the chart below.

What Does The Institutional Ownership Tell Us About Ecovacs Robotics?

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.

Ecovacs Robotics 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 Ecovacs Robotics, (below). Of course, keep in mind that there are other factors to consider, too.

Ecovacs Robotics is not owned by hedge funds. Suzhou Chuangling Zhihui Investment Management Co., Ltd. is currently the largest shareholder, with 42% of shares outstanding. With 14% and 10% of the shares outstanding respectively, Cheng Qian and Dongqi Qian are the second and third largest shareholders. Dongqi Qian, who is the third-largest shareholder, also happens to hold the title of Chairman of the Board. Furthermore, CEO Jianhua Zhuang is the owner of 1.9% of the company's shares.

To make our study more interesting, we found that the top 2 shareholders have a majority ownership in the company, meaning that they are powerful enough to influence the decisions of the company.

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

Insider Ownership Of Ecovacs Robotics

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. 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.

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.

Our most recent data indicates that insiders own a reasonable proportion of Ecovacs Robotics Co., Ltd.. It has a market capitalization of just CN¥24b, and insiders have CN¥6.7b worth of shares in their own names. That's quite significant. It is good to see this level of investment. You can check here to see if those insiders have been buying recently.

General Public Ownership

The general public-- including retail investors -- own 22% stake in the company, and hence can't easily be ignored. 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

We can see that Private Companies own 43%, of the shares on issue. 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:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. To that end, you should be aware of the 2 warning signs we've spotted with Ecovacs Robotics .

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