Key Insights

• Institutions' substantial holdings in Suzhou Novosense Microelectronics implies that they have significant influence over the company's share price
• The top 12 shareholders own 50% of the company
• Insiders own 25% of Suzhou Novosense Microelectronics

Every investor in Suzhou Novosense Microelectronics Co., Ltd. (SHSE:688052) should be aware of the most powerful shareholder groups. The group holding the most number of shares in the company, around 42% to be precise, is institutions. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

As a result, institutional investors endured the highest losses last week after market cap fell by CN¥1.1b. Needless to say, the recent loss which further adds to the one-year loss to shareholders of 31% might not go down well especially with this category of shareholders. Institutions or "liquidity providers" control large sums of money and therefore, these types of investors usually have a lot of influence over stock price movements. As a result, if the downtrend continues, institutions may face pressures to sell Suzhou Novosense Microelectronics, which might have negative implications on individual investors.

Let's delve deeper into each type of owner of Suzhou Novosense Microelectronics, beginning with the chart below.

What Does The Institutional Ownership Tell Us About Suzhou Novosense Microelectronics?

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 Suzhou Novosense Microelectronics. This can indicate that the company has a certain degree of credibility in the investment community. However, it is best to be wary of relying on the supposed validation that comes with institutional investors. They too, get it wrong sometimes. 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 Suzhou Novosense Microelectronics' earnings history below. Of course, the future is what really matters.

Hedge funds don't have many shares in Suzhou Novosense Microelectronics. Looking at our data, we can see that the largest shareholder is the CEO Shengyang Wang with 11% of shares outstanding. With 10% and 4.6% of the shares outstanding respectively, Yun Sheng and Suzhou Ruixi Information Consulting Partnership Enterprise (Limited Partnership) are the second and third largest shareholders. Interestingly, the second-largest shareholder, Yun Sheng is also Senior Key Executive, again, pointing towards strong insider ownership amongst the company's top shareholders.

Looking at the shareholder registry, we can see that 50% of the ownership is controlled by the top 12 shareholders, meaning that no single shareholder has a majority interest in the ownership.

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 a reasonable number of analysts covering the stock, so it might be useful to find out their aggregate view on the future.

Insider Ownership Of Suzhou Novosense Microelectronics

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. 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 information suggests that insiders maintain a significant holding in Suzhou Novosense Microelectronics Co., Ltd.. Insiders own CN¥3.3b worth of shares in the CN¥13b company. That's quite meaningful. Most would say this shows a good degree of alignment with shareholders, especially in a company of this size. You can click here to see if those insiders have been buying or selling.

General Public Ownership

The general public-- including retail investors -- own 23% stake in the company, and hence can't easily be ignored. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.

Private Company Ownership

It seems that Private Companies own 10.0%, of the Suzhou Novosense Microelectronics 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:

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. Be aware that Suzhou Novosense Microelectronics is showing 1 warning sign in our investment analysis , you should know about...

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.

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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.