Key Insights

• Insiders appear to have a vested interest in Jiangsu Newamstar Packaging MachineryLtd's growth, as seen by their sizeable ownership
• The top 2 shareholders own 54% of the company
• Using data from company's past performance alongside ownership research, one can better assess the future performance of a company

A look at the shareholders of Jiangsu Newamstar Packaging Machinery Co.,Ltd (SZSE:300509) can tell us which group is most powerful. The group holding the most number of shares in the company, around 54% to be precise, is individual insiders. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

Clearly, insiders benefitted the most after the company's market cap rose by CN¥365m last week.

Let's take a closer look to see what the different types of shareholders can tell us about Jiangsu Newamstar Packaging MachineryLtd.

What Does The Institutional Ownership Tell Us About Jiangsu Newamstar Packaging MachineryLtd?

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.

We can see that Jiangsu Newamstar Packaging MachineryLtd 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 Newamstar Packaging MachineryLtd, (below). Of course, keep in mind that there are other factors to consider, too.

Jiangsu Newamstar Packaging MachineryLtd is not owned by hedge funds. Looking at our data, we can see that the largest shareholder is De Ping He with 32% of shares outstanding. Meanwhile, the second and third largest shareholders, hold 22% and 5.2%, of the shares outstanding, respectively.

To make our study more interesting, we found that the top 2 shareholders have a majority ownership in the company, meaning that they are powerful enough to influence the decisions of the company.

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. We're not picking up on any analyst coverage of the stock at the moment, so the company is unlikely to be widely held.

Insider Ownership Of Jiangsu Newamstar Packaging MachineryLtd

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.

I generally consider insider ownership to be a good thing. However, on some occasions it makes it more difficult for other shareholders to hold the board accountable for decisions.

Our most recent data indicates that insiders own the majority of Jiangsu Newamstar Packaging Machinery Co.,Ltd. This means they can collectively make decisions for the company. Given it has a market cap of CN¥2.3b, that means they have CN¥1.2b worth of shares. Most would argue this is a positive, showing strong alignment with shareholders. You can click here to see if those insiders have been buying or selling.

General Public Ownership

With a 36% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Jiangsu Newamstar Packaging MachineryLtd. 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

It seems that Private Companies own 5.2%, of the Jiangsu Newamstar Packaging MachineryLtd stock. Private companies may be related parties. Sometimes insiders have an interest in a public company through a holding in a private company, rather than in their own capacity as an individual. While it's hard to draw any broad stroke conclusions, it is worth noting as an area for further research.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Jiangsu Newamstar Packaging MachineryLtd better, we need to consider many other factors. Like risks, for instance. Every company has them, and we've spotted 3 warning signs for Jiangsu Newamstar Packaging MachineryLtd (of which 1 is concerning!) you should know about.

Of course this may not be the best stock to buy. So take a peek at this free free list of interesting companies.

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.