Key Insights

• The considerable ownership by private companies in Hengdian Group DMEGC Magnetics Ltd indicates that they collectively have a greater say in management and business strategy
• The largest shareholder of the company is Hengdian Association of economic enterprises with a 51% stake
• Institutions own 10% of Hengdian Group DMEGC Magnetics Ltd

Every investor in Hengdian Group DMEGC Magnetics Co. ,Ltd (SZSE:002056) should be aware of the most powerful shareholder groups. We can see that private companies own the lion's share in the company with 52% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

And following last week's 5.9% decline in share price, private companies suffered the most losses.

Let's delve deeper into each type of owner of Hengdian Group DMEGC Magnetics Ltd, beginning with the chart below.

What Does The Institutional Ownership Tell Us About Hengdian Group DMEGC Magnetics Ltd?

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.

Hengdian Group DMEGC Magnetics Ltd 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 Hengdian Group DMEGC Magnetics Ltd's historic earnings and revenue below, but keep in mind there's always more to the story.

Hedge funds don't have many shares in Hengdian Group DMEGC Magnetics Ltd. Looking at our data, we can see that the largest shareholder is Hengdian Association of economic enterprises with 51% of shares outstanding. With such a huge stake in the ownership, we infer that they have significant control of the future of the company. With 3.1% and 1.9% of the shares outstanding respectively, GF Fund Management Co., Ltd. and Hengdian Group Dmegc Magnetics Co.,Ltd, ESOP are the second and third largest shareholders.

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. 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 Hengdian Group DMEGC Magnetics Ltd

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. Management ultimately answers to the board. However, it is not uncommon for managers to be executive board members, especially if they are a founder or the CEO.

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 see that insiders own shares in Hengdian Group DMEGC Magnetics 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¥598m worth of shares (at current prices). 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

With a 34% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Hengdian Group DMEGC Magnetics Ltd. 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 52%, 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:

It's always worth thinking about the different groups who own shares in a company. But to understand Hengdian Group DMEGC Magnetics Ltd better, we need to consider many other factors. For example, we've discovered 3 warning signs for Hengdian Group DMEGC Magnetics Ltd (1 doesn't sit too well with us!) 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.