Key Insights

• Kunshan Dongwei TechnologyLtd's significant insider ownership suggests inherent interests in company's expansion
• The top 6 shareholders own 50% of the company
• 15% of Kunshan Dongwei TechnologyLtd is held by Institutions

To get a sense of who is truly in control of Kunshan Dongwei Technology Co.,Ltd. (SHSE:688700), it is important to understand the ownership structure of the business. And the group that holds the biggest piece of the pie are individual insiders with 51% ownership. 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 31% gain.

Let's delve deeper into each type of owner of Kunshan Dongwei TechnologyLtd, beginning with the chart below.

What Does The Institutional Ownership Tell Us About Kunshan Dongwei TechnologyLtd?

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.

Kunshan Dongwei TechnologyLtd 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. 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 Kunshan Dongwei TechnologyLtd, (below). Of course, keep in mind that there are other factors to consider, too.

Hedge funds don't have many shares in Kunshan Dongwei TechnologyLtd. Looking at our data, we can see that the largest shareholder is the CEO Jianbo Liu with 31% of shares outstanding. In comparison, the second and third largest shareholders hold about 5.1% and 4.4% of the stock. Interestingly, the third-largest shareholder, Zhiguo Xiao is also a Member of the Board of Directors, again, indicating strong insider ownership amongst the company's top shareholders.

On further inspection, we found that more than half the company's shares are owned by the top 6 shareholders, suggesting that the interests of the larger shareholders are balanced out to an extent by the smaller ones.

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. There are plenty of analysts covering the stock, so it might be worth seeing what they are forecasting, too.

Insider Ownership Of Kunshan Dongwei TechnologyLtd

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 information suggests that insiders own more than half of Kunshan Dongwei Technology Co.,Ltd.. This gives them effective control of the company. Insiders own CN¥3.7b worth of shares in the CN¥7.4b company. That's extraordinary! Most would argue this is a positive, showing strong alignment with shareholders. You can click here to see if they have been selling down their stake.

General Public Ownership

With a 30% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Kunshan Dongwei TechnologyLtd. 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

We can see that Private Companies own 4.2%, of the shares on issue. It might be worth looking deeper into this. If related parties, such as insiders, have an interest in one of these private companies, that should be disclosed in the annual report. Private companies may also have a strategic interest in the company.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Kunshan Dongwei TechnologyLtd better, we need to consider many other factors. Take risks for example - Kunshan Dongwei TechnologyLtd has 4 warning signs (and 2 which shouldn't be ignored) 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.