Key Insights

• The considerable ownership by individual investors in SDIC Intelligence Xiamen Information indicates that they collectively have a greater say in management and business strategy
• 50% of the business is held by the top 6 shareholders
• Insider ownership in SDIC Intelligence Xiamen Information is 30%

A look at the shareholders of SDIC Intelligence Xiamen Information Co., Ltd. (SZSE:300188) can tell us which group is most powerful. With 42% stake, individual investors possess the maximum shares in the company. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

While insiders, who own 30% shares weren't spared from last week's CN¥868m market cap drop, individual investors as a group suffered the maximum losses

In the chart below, we zoom in on the different ownership groups of SDIC Intelligence Xiamen Information.

What Does The Institutional Ownership Tell Us About SDIC Intelligence Xiamen Information?

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 SDIC Intelligence Xiamen Information 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 SDIC Intelligence Xiamen Information, (below). Of course, keep in mind that there are other factors to consider, too.

Hedge funds don't have many shares in SDIC Intelligence Xiamen Information. State Development & Investment Corp., Ltd. is currently the largest shareholder, with 21% of shares outstanding. In comparison, the second and third largest shareholders hold about 15% and 7.5% of the stock.

We did some more digging and found that 6 of the top shareholders account for roughly 50% of the register, implying that along with larger shareholders, there are a few smaller shareholders, thereby balancing out each others interests somewhat.

While studying institutional ownership for a company can add value to your research, it is also a good practice to research analyst recommendations to get a deeper understand of a stock's expected performance. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.

Insider Ownership Of SDIC Intelligence Xiamen Information

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.

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 maintain a significant holding in SDIC Intelligence Xiamen Information Co., Ltd.. Insiders own CN¥3.9b worth of shares in the CN¥13b company. That's quite meaningful. Most would be pleased to see the board is investing alongside them. You may wish to access this free chart showing recent trading by insiders.

General Public Ownership

With a 42% ownership, the general public, mostly comprising of individual investors, have some degree of sway over SDIC Intelligence Xiamen Information. This size of ownership, while considerable, may not be enough to change company policy if the decision is not in sync with other large shareholders.

Private Company Ownership

Our data indicates that Private Companies hold 21%, of the company's shares. 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 SDIC Intelligence Xiamen Information better, we need to consider many other factors. Consider for instance, the ever-present spectre of investment risk. We've identified 1 warning sign with SDIC Intelligence Xiamen Information , and understanding them should be part of your investment process.

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.