Key Insights

• Shenzhen Longtu Photomask's significant insider ownership suggests inherent interests in company's expansion
• 54% of the business is held by the top 3 shareholders
• 11% of Shenzhen Longtu Photomask is held by Institutions

A look at the shareholders of Shenzhen Longtu Photomask Co., Ltd. (SHSE:688721) can tell us which group is most powerful. With 54% stake, individual insiders 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).

And following last week's 4.4% decline in share price, insiders suffered the most losses.

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

What Does The Institutional Ownership Tell Us About Shenzhen Longtu Photomask?

Institutional investors commonly compare their own returns to the returns of a commonly followed index. So they generally do consider buying larger companies that are included in the relevant benchmark index.

As you can see, institutional investors have a fair amount of stake in Shenzhen Longtu Photomask. This suggests some credibility amongst professional investors. But we can't rely on that fact alone since institutions make bad investments sometimes, just like everyone does. 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 Shenzhen Longtu Photomask, (below). Of course, keep in mind that there are other factors to consider, too.

Shenzhen Longtu Photomask is not owned by hedge funds. Looking at our data, we can see that the largest shareholder is Hanqi Ke with 20% of shares outstanding. In comparison, the second and third largest shareholders hold about 20% and 15% of the stock. Note that the second and third-largest shareholders are also Senior Key Executive and Member of the Board of Directors, respectively, meaning that the company's top shareholders are insiders.

A more detailed study of the shareholder registry showed us that 3 of the top shareholders have a considerable amount of ownership in the company, via their 54% stake.

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 is a little analyst coverage of the stock, but not much. So there is room for it to gain more coverage.

Insider Ownership Of Shenzhen Longtu Photomask

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 information suggests that insiders own more than half of Shenzhen Longtu Photomask Co., Ltd.. This gives them effective control of the company. Insiders own CN¥4.3b worth of shares in the CN¥8.0b company. That's extraordinary! It is good to see this level of investment. You can check here to see if those insiders have been selling any of their shares.

General Public Ownership

The general public-- including retail investors -- own 29% 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.

Private Company Ownership

It seems that Private Companies own 6.2%, of the Shenzhen Longtu Photomask 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 Shenzhen Longtu Photomask better, we need to consider many other factors. Consider for instance, the ever-present spectre of investment risk. We've identified 2 warning signs with Shenzhen Longtu Photomask , 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.