Key Insights

• The considerable ownership by individual investors in JiangSu JiuWu Hi-Tech indicates that they collectively have a greater say in management and business strategy
• The top 25 shareholders own 42% of the company
• Ownership research, combined with past performance data can help provide a good understanding of opportunities in a stock

Every investor in JiangSu JiuWu Hi-Tech Co., Ltd. (SZSE:300631) should be aware of the most powerful shareholder groups. With 58% stake, individual investors possess the maximum shares in the company. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

As market cap fell to CN¥2.8b last week, individual investors would have faced the highest losses than any other shareholder groups of the company.

Let's delve deeper into each type of owner of JiangSu JiuWu Hi-Tech, beginning with the chart below.

What Does The Institutional Ownership Tell Us About JiangSu JiuWu Hi-Tech?

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.

We can see that JiangSu JiuWu Hi-Tech does have institutional investors; and they hold a good portion of the company's stock. 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 JiangSu JiuWu Hi-Tech, (below). Of course, keep in mind that there are other factors to consider, too.

JiangSu JiuWu Hi-Tech is not owned by hedge funds. Shanghai Dehui Group Co., Ltd. is currently the company's largest shareholder with 26% of shares outstanding. In comparison, the second and third largest shareholders hold about 3.2% and 2.4% of the stock. In addition, we found that Jianbing Dang, the CEO has 1.1% of the shares allocated to their name.

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.

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. 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 JiangSu JiuWu Hi-Tech

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. 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.

Shareholders would probably be interested to learn that insiders own shares in JiangSu JiuWu Hi-Tech Co., Ltd.. As individuals, the insiders collectively own CN¥181m worth of the CN¥2.8b company. It is good to see some investment by insiders, but it might be worth checking if those insiders have been buying.

General Public Ownership

The general public, who are usually individual investors, hold a substantial 58% stake in JiangSu JiuWu Hi-Tech, 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.

Private Company Ownership

It seems that Private Companies own 29%, of the JiangSu JiuWu Hi-Tech stock. 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:

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. Take risks for example - JiangSu JiuWu Hi-Tech has 3 warning signs we think you should be aware of.

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.