Key Insights

• Xinjiang Torch Gas' significant individual investors ownership suggests that the key decisions are influenced by shareholders from the larger public
• The top 12 shareholders own 47% of the company
• 39% of Xinjiang Torch Gas is held by insiders

A look at the shareholders of Xinjiang Torch Gas Co., Ltd (SHSE:603080) can tell us which group is most powerful. And the group that holds the biggest piece of the pie are individual investors with 53% ownership. Put another way, the group faces the maximum upside potential (or downside risk).

Following a 15% decrease in the stock price last week, individual investors suffered the most losses, but insiders who own 39% stock also took a hit.

In the chart below, we zoom in on the different ownership groups of Xinjiang Torch Gas.

See our latest analysis for Xinjiang Torch Gas

What Does The Lack Of Institutional Ownership Tell Us About Xinjiang Torch Gas?

Small companies that are not very actively traded often lack institutional investors, but it's less common to see large companies without them.

There could be various reasons why no institutions own shares in a company. Typically, small, newly listed companies don't attract much attention from fund managers, because it would not be possible for large fund managers to build a meaningful position in the company. Alternatively, there might be something about the company that has kept institutional investors away. Institutional investors may not find the historic growth of the business impressive, or there might be other factors at play. You can see the past revenue performance of Xinjiang Torch Gas, for yourself, below.

We note that hedge funds don't have a meaningful investment in Xinjiang Torch Gas. Looking at our data, we can see that the largest shareholder is Anlin Zhao with 33% of shares outstanding. For context, the second largest shareholder holds about 7.4% of the shares outstanding, followed by an ownership of 1.0% by the third-largest shareholder. Xiuli Zhang, who is the third-largest shareholder, also happens to hold the title of Member of the Board of Directors. Additionally, the company's CEO Zhilong Chen directly holds 1.0% of the total shares outstanding.

Our studies suggest that the top 12 shareholders collectively control less than half of the company's shares, meaning that the company's shares are widely disseminated and there is no dominant shareholder.

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 Torch Gas

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. 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 insiders maintain a significant holding in Xinjiang Torch Gas Co., Ltd. It has a market capitalization of just CN¥2.1b, and insiders have CN¥797m worth of shares in their own names. It is great to see insiders so invested in the business. It might be worth checking if those insiders have been buying recently.

General Public Ownership

The general public, who are usually individual investors, hold a substantial 53% stake in Xinjiang Torch Gas, 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

It seems that Private Companies own 7.4%, of the Xinjiang Torch Gas stock. It might be worth looking deeper into this. If related parties, such as insiders, have an interest in one of these private companies, that should be disclosed in the annual report. Private companies may also have a strategic interest in the 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. Be aware that Xinjiang Torch Gas is showing 2 warning signs in our investment analysis , you should know about...

Of course this may not be the best stock to buy. Therefore, you may wish to see our free collection of interesting prospects boasting favorable financials.

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.