Key Insights

• Luoyang Xinqianglian Slewing Bearing's significant insider ownership suggests inherent interests in company's expansion
• 53% of the business is held by the top 5 shareholders
• Institutional ownership in Luoyang Xinqianglian Slewing Bearing is 21%

To get a sense of who is truly in control of Luoyang Xinqianglian Slewing Bearing Co., Ltd. (SZSE:300850), it is important to understand the ownership structure of the business. The group holding the most number of shares in the company, around 38% to be precise, is individual insiders. 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, insiders were the biggest beneficiaries of last week's 7.1% gain.

Let's take a closer look to see what the different types of shareholders can tell us about Luoyang Xinqianglian Slewing Bearing.

Check out our latest analysis for Luoyang Xinqianglian Slewing Bearing

What Does The Institutional Ownership Tell Us About Luoyang Xinqianglian Slewing Bearing?

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.

Luoyang Xinqianglian Slewing Bearing already has institutions on the share registry. Indeed, they own a respectable stake in the company. 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. 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 Luoyang Xinqianglian Slewing Bearing, (below). Of course, keep in mind that there are other factors to consider, too.

Hedge funds don't have many shares in Luoyang Xinqianglian Slewing Bearing. Zhenqiang Xiao is currently the company's largest shareholder with 19% of shares outstanding. For context, the second largest shareholder holds about 18% of the shares outstanding, followed by an ownership of 7.7% by the third-largest shareholder. Gaoqiang Xiao, who is the second-largest shareholder, also happens to hold the title of Chief Executive Officer.

On looking further, we found that 53% of the shares are owned by the top 5 shareholders. In other words, these shareholders have a meaningful say in the decisions of the company.

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 some analyst coverage of the stock, but it could still become more well known, with time.

Insider Ownership Of Luoyang Xinqianglian Slewing Bearing

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.

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 most recent data indicates that insiders own a reasonable proportion of Luoyang Xinqianglian Slewing Bearing Co., Ltd.. It has a market capitalization of just CN¥12b, and insiders have CN¥4.5b worth of shares in their own names. That's quite significant. It is good to see this level of investment. You can check here to see if those insiders have been buying recently.

General Public Ownership

With a 34% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Luoyang Xinqianglian Slewing Bearing. 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.

Private Equity Ownership

Private equity firms hold a 7.7% stake in Luoyang Xinqianglian Slewing Bearing. This suggests they can be influential in key policy decisions. Sometimes we see private equity stick around for the long term, but generally speaking they have a shorter investment horizon and -- as the name suggests -- don't invest in public companies much. After some time they may look to sell and redeploy capital elsewhere.

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. For example, we've discovered 4 warning signs for Luoyang Xinqianglian Slewing Bearing (2 are concerning!) that you should be aware of before investing here.

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.