Key Insights

• Significant insider control over Zhejiang Dahua Technology implies vested interests in company growth
• 51% of the business is held by the top 6 shareholders
• 18% of Zhejiang Dahua Technology is held by Institutions

A look at the shareholders of Zhejiang Dahua Technology Co., Ltd. (SZSE:002236) can tell us which group is most powerful. The group holding the most number of shares in the company, around 41% to be precise, is individual insiders. Put another way, the group faces the maximum upside potential (or downside risk).

So, insiders of Zhejiang Dahua Technology have a lot at stake and every decision they make on the company's future is important to them from a financial point of view.

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

What Does The Institutional Ownership Tell Us About Zhejiang Dahua Technology?

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.

Zhejiang Dahua Technology 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. 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 Zhejiang Dahua Technology's earnings history below. Of course, the future is what really matters.

Hedge funds don't have many shares in Zhejiang Dahua Technology. Looking at our data, we can see that the largest shareholder is the CEO Liquan Fu with 31% of shares outstanding. In comparison, the second and third largest shareholders hold about 9.0% and 4.9% of the stock.

We did some more digging and found that 6 of the top shareholders account for roughly 51% of the register, implying that along with larger shareholders, there are a few smaller shareholders, thereby balancing out each others interests somewhat.

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. There are a reasonable number of analysts covering the stock, so it might be useful to find out their aggregate view on the future.

Insider Ownership Of Zhejiang Dahua Technology

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 Zhejiang Dahua Technology Co., Ltd.. It is very interesting to see that insiders have a meaningful CN¥22b stake in this CN¥54b business. 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

The general public-- including retail investors -- own 32% stake in the company, and hence can't easily be ignored. 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

It seems that Private Companies own 9.0%, of the Zhejiang Dahua Technology 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:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. Like risks, for instance. Every company has them, and we've spotted 2 warning signs for Zhejiang Dahua Technology (of which 1 is concerning!) you should know about.

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.