Key Insights

• The considerable ownership by private companies in Fortior Technology (Shenzhen) indicates that they collectively have a greater say in management and business strategy
• 52% of the business is held by the top 2 shareholders
• Institutions own 26% of Fortior Technology (Shenzhen)

If you want to know who really controls Fortior Technology (Shenzhen) Co., Ltd. (SHSE:688279), then you'll have to look at the makeup of its share registry. The group holding the most number of shares in the company, around 43% to be precise, is private companies. Put another way, the group faces the maximum upside potential (or downside risk).

While institutions, who own 26% shares weren't spared from last week's CN¥1.0b market cap drop, private companies as a group suffered the maximum losses

Let's delve deeper into each type of owner of Fortior Technology (Shenzhen), beginning with the chart below.

See our latest analysis for Fortior Technology (Shenzhen)

What Does The Institutional Ownership Tell Us About Fortior Technology (Shenzhen)?

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.

As you can see, institutional investors have a fair amount of stake in Fortior Technology (Shenzhen). 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. 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 Fortior Technology (Shenzhen)'s historic earnings and revenue below, but keep in mind there's always more to the story.

We note that hedge funds don't have a meaningful investment in Fortior Technology (Shenzhen). Fortior Technology (HK) Company Limited is currently the company's largest shareholder with 38% of shares outstanding. For context, the second largest shareholder holds about 14% of the shares outstanding, followed by an ownership of 4.0% by the third-largest shareholder. In addition, we found that Bi Lei, the CEO has 1.5% of the shares allocated to their name.

After doing some more digging, we found that the top 2 shareholders collectively control more than half of the company's shares, implying that they have considerable power to influence the company's decisions.

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. There are a reasonable number of analysts covering the stock, so it might be useful to find out their aggregate view on the future.

Insider Ownership Of Fortior Technology (Shenzhen)

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. 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 Fortior Technology (Shenzhen) 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¥387m 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 12% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Fortior Technology (Shenzhen). 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 Equity Ownership

Private equity firms hold a 14% stake in Fortior Technology (Shenzhen). This suggests they can be influential in key policy decisions. Some investors might be encouraged by this, since private equity are sometimes able to encourage strategies that help the market see the value in the company. Alternatively, those holders might be exiting the investment after taking it public.

Private Company Ownership

We can see that Private Companies own 43%, of the shares on issue. 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:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. Be aware that Fortior Technology (Shenzhen) is showing 1 warning sign in our investment analysis , you should know about...

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.