Key Insights

• Shenyang Machine Tool's significant private companies ownership suggests that the key decisions are influenced by shareholders from the larger public
• A total of 3 investors have a majority stake in the company with 51% ownership
• Institutions own 13% of Shenyang Machine Tool

Every investor in Shenyang Machine Tool Co., Ltd. (SZSE:000410) should be aware of the most powerful shareholder groups. The group holding the most number of shares in the company, around 50% to be precise, is private companies. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

As a result, private companies collectively scored the highest last week as the company hit CN¥15b market cap following a 11% gain in the stock.

Let's delve deeper into each type of owner of Shenyang Machine Tool, beginning with the chart below.

What Does The Institutional Ownership Tell Us About Shenyang Machine Tool?

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 Shenyang Machine Tool. 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. 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 Shenyang Machine Tool, (below). Of course, keep in mind that there are other factors to consider, too.

Shenyang Machine Tool is not owned by hedge funds. The company's largest shareholder is China General Technology (Group) Holding Co.,Ltd., with ownership of 43%. For context, the second largest shareholder holds about 4.1% of the shares outstanding, followed by an ownership of 4.0% by the third-largest shareholder.

After doing some more digging, we found that the top 3 shareholders collectively control more than half of the company's shares, implying that they have considerable power to influence the company's decisions.

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. Our information suggests that there isn't any analyst coverage of the stock, so it is probably little known.

Insider Ownership Of Shenyang Machine Tool

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.

We note our data does not show any board members holding shares, personally. Not all jurisdictions have the same rules around disclosing insider ownership, and it is possible we have missed something, here. So you can click here learn more about the CEO.

General Public Ownership

The general public, who are usually individual investors, hold a 37% stake in Shenyang Machine Tool. 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

Our data indicates that Private Companies hold 50%, of the company's shares. It might be worth looking deeper into this. If related parties, such as insiders, have an interest in one of these private companies, that should be disclosed in the annual report. Private companies may also have a strategic interest in the company.

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 Shenyang Machine Tool is showing 2 warning signs in our investment analysis , and 1 of those is a bit concerning...

Of course this may not be the best stock to buy. So take a peek at this free free list of interesting companies.

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.