Key Insights

• The considerable ownership by public companies in Skyworth Digital indicates that they collectively have a greater say in management and business strategy
• 53% of the company is held by a single shareholder (Skyworth Group Limited)
• Using data from analyst forecasts alongside ownership research, one can better assess the future performance of a company

To get a sense of who is truly in control of Skyworth Digital Co., Ltd. (SZSE:000810), it is important to understand the ownership structure of the business. The group holding the most number of shares in the company, around 53% to be precise, is public companies. Put another way, the group faces the maximum upside potential (or downside risk).

And following last week's 7.7% decline in share price, public companies suffered the most losses.

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

What Does The Institutional Ownership Tell Us About Skyworth Digital?

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.

Skyworth Digital 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 Skyworth Digital'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 Skyworth Digital. Looking at our data, we can see that the largest shareholder is Skyworth Group Limited with 53% of shares outstanding. This essentially means that they have extensive influence, if not outright control, over the future of the corporation. AEGON-Industrial Fund Management Co. Ltd. is the second largest shareholder owning 3.6% of common stock, and Chi Shi holds about 3.2% of the company stock. Chi Shi, who is the third-largest shareholder, also happens to hold the title of Chairman of the Board.

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 Skyworth Digital

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. 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.

Insider ownership is positive when it signals leadership are thinking like the true owners of the company. However, high insider ownership can also give immense power to a small group within the company. This can be negative in some circumstances.

We can report that insiders do own shares in Skyworth Digital Co., Ltd.. The insiders have a meaningful stake worth CN¥1.3b. Most would see this as a real positive. If you would like to explore the question of insider alignment, you can click here to see if insiders have been buying or selling.

General Public Ownership

The general public-- including retail investors -- own 30% 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.

Public Company Ownership

It appears to us that public companies own 53% of Skyworth Digital. We can't be certain but it is quite possible this is a strategic stake. The businesses may be similar, or work together.

Next Steps:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. For example, we've discovered 2 warning signs for Skyworth Digital (1 can't be ignored!) that you should be aware of before investing here.

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.