Key Insights

• The considerable ownership by retail investors in Sanan OptoelectronicsLtd indicates that they collectively have a greater say in management and business strategy
• A total of 10 investors have a majority stake in the company with 51% ownership
• Institutions own 22% of Sanan OptoelectronicsLtd

A look at the shareholders of Sanan Optoelectronics Co.,Ltd (SHSE:600703) can tell us which group is most powerful. The group holding the most number of shares in the company, around 41% to be precise, is retail investors. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

And private companies on the other hand have a 32% ownership in the company.

In the chart below, we zoom in on the different ownership groups of Sanan OptoelectronicsLtd.

What Does The Institutional Ownership Tell Us About Sanan OptoelectronicsLtd?

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 Sanan OptoelectronicsLtd 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. 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 Sanan OptoelectronicsLtd's historic earnings and revenue below, but keep in mind there's always more to the story.

Sanan OptoelectronicsLtd is not owned by hedge funds. Fujian San'an Group Co., Ltd. is currently the company's largest shareholder with 30% of shares outstanding. Meanwhile, the second and third largest shareholders, hold 5.8% and 2.8%, of the shares outstanding, respectively.

We did some more digging and found that 10 of the top shareholders account for roughly 51% of the register, implying that along with larger shareholders, there are a few smaller shareholders, thereby balancing out each others interests somewhat.

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 Sanan OptoelectronicsLtd

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. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.

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 information suggests that Sanan Optoelectronics Co.,Ltd insiders own under 1% of the company. But they may have an indirect interest through a corporate structure that we haven't picked up on. As it is a large company, we'd only expect insiders to own a small percentage of it. But it's worth noting that they own CN¥83m worth of shares. Arguably recent buying and selling is just as important to consider. You can click here to see if insiders have been buying or selling.

General Public Ownership

With a 41% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Sanan OptoelectronicsLtd. 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 32%, of the Sanan OptoelectronicsLtd stock. 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:

I find it very interesting to look at who exactly owns a company. But to truly gain insight, we need to consider other information, too. Consider for instance, the ever-present spectre of investment risk. We've identified 1 warning sign with Sanan OptoelectronicsLtd , and understanding them should be part of your investment process.

If you would prefer discover what analysts are predicting in terms of future growth, do not miss this free report on analyst forecasts.

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.