Key Insights

• Significant control over Zhejiang Wanfeng Auto Wheel by individual investors implies that the general public has more power to influence management and governance-related decisions
• A total of 5 investors have a majority stake in the company with 51% ownership
• Institutional ownership in Zhejiang Wanfeng Auto Wheel is 15%

To get a sense of who is truly in control of Zhejiang Wanfeng Auto Wheel Co., Ltd. (SZSE:002085), it is important to understand the ownership structure of the business. We can see that individual investors own the lion's share in the company with 41% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

As a result, individual investors as a group endured the highest losses last week after market cap fell by CN¥1.7b.

Let's delve deeper into each type of owner of Zhejiang Wanfeng Auto Wheel, beginning with the chart below.

What Does The Institutional Ownership Tell Us About Zhejiang Wanfeng Auto Wheel?

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 Wanfeng Auto Wheel 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 Zhejiang Wanfeng Auto Wheel, (below). Of course, keep in mind that there are other factors to consider, too.

Zhejiang Wanfeng Auto Wheel is not owned by hedge funds. Our data shows that Wanfeng Auto Holding Group Co.,Ltd is the largest shareholder with 34% of shares outstanding. Meanwhile, the second and third largest shareholders, hold 7.9% and 4.6%, of the shares outstanding, respectively.

Our research also brought to light the fact that roughly 51% of the company is controlled by the top 5 shareholders suggesting that these owners wield significant influence on the business.

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. While there is some analyst coverage, the company is probably not widely covered. So it could gain more attention, down the track.

Insider Ownership Of Zhejiang Wanfeng Auto Wheel

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.

Our most recent data indicates that insiders own some shares in Zhejiang Wanfeng Auto Wheel Co., Ltd.. It is a pretty big company, so it is generally a positive to see some potentially meaningful alignment. In this case, they own around CN¥1.3b worth of shares (at current prices). Most would say this shows alignment of interests between shareholders and the board. Still, it might be worth checking if those insiders have been selling.

General Public Ownership

With a 41% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Zhejiang Wanfeng Auto Wheel. 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

We can see that Private Companies own 34%, of the shares on issue. 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. Take risks for example - Zhejiang Wanfeng Auto Wheel has 4 warning signs (and 1 which is a bit unpleasant) we think you should know about.

Ultimately the future is most important. You can access this free report on analyst forecasts for the company.

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.