Key Insights

• Shanghai Medicilon's significant insider ownership suggests inherent interests in company's expansion
• A total of 9 investors have a majority stake in the company with 51% ownership
• Institutions own 11% of Shanghai Medicilon

If you want to know who really controls Shanghai Medicilon Inc. (SHSE:688202), then you'll have to look at the makeup of its share registry. We can see that individual insiders own the lion's share in the company with 46% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

As a result, insiders scored the highest last week as the company hit CN¥4.0b market cap following a 24% gain in the stock.

Let's take a closer look to see what the different types of shareholders can tell us about Shanghai Medicilon.

What Does The Institutional Ownership Tell Us About Shanghai Medicilon?

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.

We can see that Shanghai Medicilon does have institutional investors; and they hold a good portion of the company's stock. 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. 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 Shanghai Medicilon's earnings history below. Of course, the future is what really matters.

Hedge funds don't have many shares in Shanghai Medicilon. Jinzhang Chen is currently the largest shareholder, with 12% of shares outstanding. With 12% and 9.0% of the shares outstanding respectively, Chunlin Chen and Jianhuang Chen are the second and third largest shareholders. Chunlin Chen, who is the second-largest shareholder, also happens to hold the title of Chief Executive Officer.

We also observed that the top 9 shareholders account for more than half of the share register, with a few smaller shareholders to balance the interests of the larger ones to a certain extent.

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

Insider Ownership Of Shanghai Medicilon

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.

It seems insiders own a significant proportion of Shanghai Medicilon Inc.. Insiders have a CN¥1.8b stake in this CN¥4.0b business. This may suggest that the founders still own a lot of shares. You can click here to see if they have been buying or selling.

General Public Ownership

The general public-- including retail investors -- own 42% stake in the company, and hence can't easily be ignored. 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:

It's always worth thinking about the different groups who own shares in a company. But to understand Shanghai Medicilon better, we need to consider many other factors. For instance, we've identified 1 warning sign for Shanghai Medicilon that you should be aware of.

If you would prefer discover what analysts are predicting in terms of future growth, do not miss this free report on analyst forecasts.

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.