Key Insights

• The considerable ownership by retail investors in Zhongshan Broad-Ocean Motor indicates that they collectively have a greater say in management and business strategy
• A total of 25 investors have a majority stake in the company with 44% ownership
• Insiders own 38% of Zhongshan Broad-Ocean Motor

A look at the shareholders of Zhongshan Broad-Ocean Motor Co., Ltd. (SZSE:002249) can tell us which group is most powerful. The group holding the most number of shares in the company, around 55% to be precise, is retail investors. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

While retail investors were the group that benefitted the most from last week's CN¥1.5b market cap gain, insiders too had a 38% share in those profits.

Let's delve deeper into each type of owner of Zhongshan Broad-Ocean Motor, beginning with the chart below.

What Does The Institutional Ownership Tell Us About Zhongshan Broad-Ocean Motor?

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.

Institutions have a very small stake in Zhongshan Broad-Ocean Motor. That indicates that the company is on the radar of some funds, but it isn't particularly popular with professional investors at the moment. If the business gets stronger from here, we could see a situation where more institutions are keen to buy. It is not uncommon to see a big share price rise if multiple institutional investors are trying to buy into a stock at the same time. So check out the historic earnings trajectory, below, but keep in mind it's the future that counts most.

Zhongshan Broad-Ocean Motor is not owned by hedge funds. Looking at our data, we can see that the largest shareholder is Chuping Lu with 25% of shares outstanding. Hai Ming Xu is the second largest shareholder owning 5.8% of common stock, and Jun Gong holds about 2.5% of the company stock. Hai Ming Xu, who is the second-largest shareholder, also happens to hold the title of Chief Executive Officer.

Our studies suggest that the top 25 shareholders collectively control less than half of the company's shares, meaning that the company's shares are widely disseminated and there is no dominant shareholder.

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. As far as we can tell there isn't analyst coverage of the company, so it is probably flying under the radar.

Insider Ownership Of Zhongshan Broad-Ocean Motor

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.

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.

Our most recent data indicates that insiders own a reasonable proportion of Zhongshan Broad-Ocean Motor Co., Ltd.. It is very interesting to see that insiders have a meaningful CN¥5.0b stake in this CN¥13b business. Most would say this shows a good degree of alignment with shareholders, especially in a company of this size. You can click here to see if those insiders have been buying or selling.

General Public Ownership

The general public, who are usually individual investors, hold a substantial 55% stake in Zhongshan Broad-Ocean Motor, suggesting it is a fairly popular stock. This level of ownership gives investors from the wider public some power to sway key policy decisions such as board composition, executive compensation, and the dividend payout ratio.

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. Be aware that Zhongshan Broad-Ocean Motor is showing 1 warning sign in our investment analysis , you should know about...

Of course this may not be the best stock to buy. So take a peek at this free free list of interesting companies.

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.