Key Insights

• The considerable ownership by individual investors in Simei MediaLtd indicates that they collectively have a greater say in management and business strategy
• A total of 16 investors have a majority stake in the company with 50% ownership
• Institutional ownership in Simei MediaLtd is 11%

If you want to know who really controls Simei Media Co.,Ltd. (SZSE:002712), then you'll have to look at the makeup of its share registry. And the group that holds the biggest piece of the pie are individual investors with 48% ownership. Put another way, the group faces the maximum upside potential (or downside risk).

And last week, individual investors endured the biggest losses as the stock fell by 24%.

In the chart below, we zoom in on the different ownership groups of Simei MediaLtd.

What Does The Institutional Ownership Tell Us About Simei MediaLtd?

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.

Simei MediaLtd already has institutions on the share registry. Indeed, they own a respectable stake in the company. This implies the analysts working for those institutions have looked at the stock and they like it. But just like anyone else, they could be wrong. 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 Simei MediaLtd's historic earnings and revenue below, but keep in mind there's always more to the story.

We note that hedge funds don't have a meaningful investment in Simei MediaLtd. The company's largest shareholder is Sichuan Tourism Investment Group Co., Ltd., with ownership of 32%. With 5.6% and 3.5% of the shares outstanding respectively, Mingqiu Zhu and Shanghai Orient Securities Asset Management Co., Ltd. are the second and third largest shareholders. Mingqiu Zhu, who is the second-largest shareholder, also happens to hold the title of Top Key Executive.

After doing some more digging, we found that the top 16 have the combined ownership of 50% in the company, suggesting that no single shareholder has significant control over the company.

While it makes sense to study institutional ownership data for a company, it also makes sense to study analyst sentiments to know which way the wind is blowing. Our information suggests that there isn't any analyst coverage of the stock, so it is probably little known.

Insider Ownership Of Simei MediaLtd

The definition of company insiders can be subjective and does vary between jurisdictions. Our data reflects individual insiders, capturing board members at the very least. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.

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 can see that insiders own shares in Simei Media Co.,Ltd.. It has a market capitalization of just CN¥2.0b, and insiders have CN¥132m worth of shares, in their own names. Some would say this shows alignment of interests between shareholders and the board. But it might be worth checking if those insiders have been selling.

General Public Ownership

The general public-- including retail investors -- own 48% 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.

Private Company Ownership

It seems that Private Companies own 34%, of the Simei MediaLtd stock. It's hard to draw any conclusions from this fact alone, so its worth looking into who owns those private companies. Sometimes insiders or other related parties have an interest in shares in a public company through a separate private company.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Simei MediaLtd better, we need to consider many other factors. Like risks, for instance. Every company has them, and we've spotted 4 warning signs for Simei MediaLtd (of which 3 are a bit unpleasant!) you should know about.

Of course this may not be the best stock to buy. Therefore, you may wish to see our free collection of interesting prospects boasting favorable financials.

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
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.