Key Insights

• Tianjin You Fa Steel Pipe Group Stock's significant insider ownership suggests inherent interests in company's expansion
• The top 11 shareholders own 51% of the company
• Ownership research, combined with past performance data can help provide a good understanding of opportunities in a stock

To get a sense of who is truly in control of Tianjin You Fa Steel Pipe Group Stock Co., Ltd. (SHSE:601686), it is important to understand the ownership structure of the business. And the group that holds the biggest piece of the pie are individual insiders with 50% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

Clearly, insiders benefitted the most after the company's market cap rose by CN¥403m last week.

Let's take a closer look to see what the different types of shareholders can tell us about Tianjin You Fa Steel Pipe Group Stock.

What Does The Institutional Ownership Tell Us About Tianjin You Fa Steel Pipe Group Stock?

Institutions typically measure themselves against a benchmark when reporting to their own investors, so they often become more enthusiastic about a stock once it's included in a major index. We would expect most companies to have some institutions on the register, especially if they are growing.

Since institutions own only a small portion of Tianjin You Fa Steel Pipe Group Stock, many may not have spent much time considering the stock. But it's clear that some have; and they liked it enough to buy in. If the company is growing earnings, that may indicate that it is just beginning to catch the attention of these deep-pocketed investors. When multiple institutional investors want to buy shares, we often see a rising share price. The past revenue trajectory (shown below) can be an indication of future growth, but there are no guarantees.

We note that hedge funds don't have a meaningful investment in Tianjin You Fa Steel Pipe Group Stock. The company's largest shareholder is Maojin Li, with ownership of 20%. Meanwhile, the second and third largest shareholders, hold 6.9% and 6.6%, of the shares outstanding, respectively. Guangyou Xu, who is the second-largest shareholder, also happens to hold the title of Senior Key Executive. Furthermore, CEO Guangling Chen is the owner of 4.1% of the company's shares.

Looking at the shareholder registry, we can see that 51% of the ownership is controlled by the top 11 shareholders, meaning that no single shareholder has a majority interest in the ownership.

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. There is a little analyst coverage of the stock, but not much. So there is room for it to gain more coverage.

Insider Ownership Of Tianjin You Fa Steel Pipe Group Stock

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.

I generally consider insider ownership to be a good thing. However, on some occasions it makes it more difficult for other shareholders to hold the board accountable for decisions.

Our information suggests that insiders own more than half of Tianjin You Fa Steel Pipe Group Stock Co., Ltd.. This gives them effective control of the company. Given it has a market cap of CN¥8.3b, that means insiders have a whopping CN¥4.2b worth of shares in their own names. Most would argue this is a positive, showing strong alignment with shareholders. You can click here to see if they have been selling down their stake.

General Public Ownership

The general public, who are usually individual investors, hold a 47% stake in Tianjin You Fa Steel Pipe Group Stock. 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.

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 Tianjin You Fa Steel Pipe Group Stock .

But ultimately it is the future, not the past, that will determine how well the owners of this business will do. Therefore we think it advisable to take a look at this free report showing whether analysts are predicting a brighter 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.