Key Insights

• Insiders appear to have a vested interest in Jianzhijia Pharmaceutical Chain Group's growth, as seen by their sizeable ownership
• A total of 4 investors have a majority stake in the company with 55% ownership
• Institutions own 28% of Jianzhijia Pharmaceutical Chain Group

Every investor in Jianzhijia Pharmaceutical Chain Group Co., Ltd. (SHSE:605266) should be aware of the most powerful shareholder groups. The group holding the most number of shares in the company, around 34% to be precise, is individual insiders. Put another way, the group faces the maximum upside potential (or downside risk).

Clearly, insiders benefitted the most after the company's market cap rose by CN¥880m last week.

Let's take a closer look to see what the different types of shareholders can tell us about Jianzhijia Pharmaceutical Chain Group.

What Does The Institutional Ownership Tell Us About Jianzhijia Pharmaceutical Chain Group?

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 Jianzhijia Pharmaceutical Chain Group does have institutional investors; and they hold a good portion of the company's stock. 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. If multiple institutions change their view on a stock at the same time, you could see the share price drop fast. It's therefore worth looking at Jianzhijia Pharmaceutical Chain Group's earnings history below. Of course, the future is what really matters.

Hedge funds don't have many shares in Jianzhijia Pharmaceutical Chain Group. With a 23% stake, CEO Bo Lan is the largest shareholder. With 15% and 10% of the shares outstanding respectively, Shenzhen Changsihang Industrial Development Co., Ltd. and Yanping Wang are the second and third largest shareholders.

On looking further, we found that 55% of the shares are owned by the top 4 shareholders. In other words, these shareholders have a meaningful say in the decisions of the company.

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 are plenty of analysts covering the stock, so it might be worth seeing what they are forecasting, too.

Insider Ownership Of Jianzhijia Pharmaceutical Chain Group

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. 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.

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.

Our most recent data indicates that insiders own a reasonable proportion of Jianzhijia Pharmaceutical Chain Group Co., Ltd.. Insiders have a CN¥2.3b stake in this CN¥6.8b business. We would say this shows alignment with shareholders, but it is worth noting that the company is still quite small; some insiders may have founded the business. You can click here to see if those insiders have been buying or selling.

General Public Ownership

The general public-- including retail investors -- own 23% 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

Our data indicates that Private Companies hold 15%, of the company's shares. 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:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. For example, we've discovered 2 warning signs for Jianzhijia Pharmaceutical Chain Group that you should be aware of before investing here.

Ultimately the future is most important. You can access this free report on analyst forecasts for the company.

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.