Key Insights

• The considerable ownership by individual investors in Xinjiang Bai Hua Cun Pharma TechLtd indicates that they collectively have a greater say in management and business strategy
• 41% of the business is held by the top 15 shareholders
• Ownership research, combined with past performance data can help provide a good understanding of opportunities in a stock

Every investor in Xinjiang Bai Hua Cun Pharma Tech Co.,Ltd (SHSE:600721) should be aware of the most powerful shareholder groups. The group holding the most number of shares in the company, around 59% to be precise, is individual investors. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

As a result, individual investors were the biggest beneficiaries of last week's 19% gain.

Let's take a closer look to see what the different types of shareholders can tell us about Xinjiang Bai Hua Cun Pharma TechLtd.

What Does The Institutional Ownership Tell Us About Xinjiang Bai Hua Cun Pharma TechLtd?

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.

Since institutions own only a small portion of Xinjiang Bai Hua Cun Pharma TechLtd, many may not have spent much time considering the stock. But it's clear that some have; and they liked it enough to buy in. So if the company itself can improve over time, we may well see more institutional buyers in the future. When multiple institutional investors want to buy shares, we often see a rising share price. The past revenue trajectory (shown below) can be an indication of future growth, but there are no guarantees.

We note that hedge funds don't have a meaningful investment in Xinjiang Bai Hua Cun Pharma TechLtd. Our data shows that Hualing Group Investment Holding (Xinjiang) Co., Ltd. is the largest shareholder with 21% of shares outstanding. In comparison, the second and third largest shareholders hold about 4.4% and 4.2% of the stock.

A deeper look at our ownership data shows that the top 15 shareholders collectively hold less than half of the register, suggesting a large group of small holders where no single shareholder has a majority.

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. As far as we can tell there isn't analyst coverage of the company, so it is probably flying under the radar.

Insider Ownership Of Xinjiang Bai Hua Cun Pharma TechLtd

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.

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.

We can see that insiders own shares in Xinjiang Bai Hua Cun Pharma Tech Co.,Ltd. In their own names, insiders own CN¥229m worth of stock in the CN¥2.5b company. It is good to see some investment by insiders, but it might be worth checking if those insiders have been buying.

General Public Ownership

The general public, who are usually individual investors, hold a substantial 59% stake in Xinjiang Bai Hua Cun Pharma TechLtd, suggesting it is a fairly popular stock. With this amount of ownership, retail investors can collectively play a role in decisions that affect shareholder returns, such as dividend policies and the appointment of directors. They can also exercise the power to vote on acquisitions or mergers that may not improve profitability.

Private Company Ownership

We can see that Private Companies own 30%, 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:

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.

I like to dive deeper into how a company has performed in the past. You can find historic revenue and earnings in this detailed graph.

If you would prefer check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, backed by strong financial data.

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.