Key Insights

• Significant control over Joinn Laboratories(China)Co.Ltd by retail investors implies that the general public has more power to influence management and governance-related decisions
• The top 13 shareholders own 50% of the company
• 39% of Joinn Laboratories(China)Co.Ltd is held by insiders

A look at the shareholders of Joinn Laboratories(China)Co.,Ltd. (SHSE:603127) can tell us which group is most powerful. And the group that holds the biggest piece of the pie are retail investors with 42% ownership. Put another way, the group faces the maximum upside potential (or downside risk).

Following a 9.5% decrease in the stock price last week, retail investors suffered the most losses, but insiders who own 39% stock also took a hit.

In the chart below, we zoom in on the different ownership groups of Joinn Laboratories(China)Co.Ltd.

What Does The Institutional Ownership Tell Us About Joinn Laboratories(China)Co.Ltd?

Institutional investors commonly compare their own returns to the returns of a commonly followed index. So they generally do consider buying larger companies that are included in the relevant benchmark index.

As you can see, institutional investors have a fair amount of stake in Joinn Laboratories(China)Co.Ltd. 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. 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 Joinn Laboratories(China)Co.Ltd'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 Joinn Laboratories(China)Co.Ltd. Our data suggests that Yuxia Feng, who is also the company's Top Key Executive, holds the most number of shares at 22%. 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. Zhi Wen Zhou is the second largest shareholder owning 10% of common stock, and Zhong Ou Fund Management Co., Ltd holds about 3.2% of the company stock.

Looking at the shareholder registry, we can see that 50% of the ownership is controlled by the top 13 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. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.

Insider Ownership Of Joinn Laboratories(China)Co.Ltd

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. Management ultimately answers to the board. However, it is not uncommon for managers to be executive board members, especially if they are a founder or the CEO.

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 Joinn Laboratories(China)Co.,Ltd.. It has a market capitalization of just CN¥9.1b, and insiders have CN¥3.5b worth of shares in their own names. That's quite significant. 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, who are usually individual investors, hold a 42% stake in Joinn Laboratories(China)Co.Ltd. 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.

Next Steps:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. Be aware that Joinn Laboratories(China)Co.Ltd 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.