Recent 9.3% pullback would hurt Hebei Yangyuan ZhiHui Beverage Co., Ltd. (SHSE:603156) insiders - Simply Wall St

Key Insights

Significant insider control over Hebei Yangyuan ZhiHui Beverage implies vested interests in company growth
The top 4 shareholders own 59% of the company
Ownership research, combined with past performance data can help provide a good understanding of opportunities in a stock

To get a sense of who is truly in control of Hebei Yangyuan ZhiHui Beverage Co., Ltd. (SHSE:603156), it is important to understand the ownership structure of the business. And the group that holds the biggest piece of the pie are individual insiders with 52% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

As a result, insiders as a group endured the highest losses after market cap fell by CN¥3.0b.

Let's take a closer look to see what the different types of shareholders can tell us about Hebei Yangyuan ZhiHui Beverage.

View our latest analysis for Hebei Yangyuan ZhiHui Beverage

ownership-breakdown — SHSE:603156 Ownership Breakdown June 11th 2024

What Does The Institutional Ownership Tell Us About Hebei Yangyuan ZhiHui Beverage?

Institutional investors commonly compare their own returns to the returns of a commonly followed index. So they generally do consider buying larger companies that are included in the relevant benchmark index.

Less than 5% of Hebei Yangyuan ZhiHui Beverage is held by institutional investors. This suggests that some funds have the company in their sights, but many have not yet bought shares in it. If the business gets stronger from here, we could see a situation where more institutions are keen to buy. It is not uncommon to see a big share price rise if multiple institutional investors are trying to buy into a stock at the same time. So check out the historic earnings trajectory, below, but keep in mind it's the future that counts most.

earnings-and-revenue-growth — SHSE:603156 Earnings and Revenue Growth June 11th 2024

We note that hedge funds don't have a meaningful investment in Hebei Yangyuan ZhiHui Beverage. Looking at our data, we can see that the largest shareholder is Kuizhang Yao with 21% of shares outstanding. In comparison, the second and third largest shareholders hold about 18% and 9.9% of the stock. Hongbing Li, who is the third-largest shareholder, also happens to hold the title of Chairman of Corporate Board. Additionally, the company's CEO Zhaolin Fan directly holds 9.9% of the total shares outstanding.

To make our study more interesting, we found that the top 4 shareholders control more than half of the company which implies that this group has considerable sway over the company's decision-making.

While it makes sense to study institutional ownership data for a company, it also makes sense to study analyst sentiments to know which way the wind is blowing. Our information suggests that there isn't any analyst coverage of the stock, so it is probably little known.

Insider Ownership Of Hebei Yangyuan ZhiHui Beverage

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

Our most recent data indicates that insiders own the majority of Hebei Yangyuan ZhiHui Beverage Co., Ltd.. This means they can collectively make decisions for the company. Given it has a market cap of CN¥29b, that means insiders have a whopping CN¥15b worth of shares in their own names. It is good to see this level of investment. You can check here to see if those insiders have been selling any of their shares.

General Public Ownership

The general public-- including retail investors -- own 25% stake in the company, and hence can't easily be ignored. 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 18%, of the Hebei Yangyuan ZhiHui Beverage 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. Consider risks, for instance. Every company has them, and we've spotted 2 warning signs for Hebei Yangyuan ZhiHui Beverage 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.

Valuation is complex, but we're helping make it simple.

Find out whether Hebei Yangyuan ZhiHui Beverage is potentially over or undervalued by checking out our comprehensive analysis, which includes fair value estimates, risks and warnings, dividends, insider transactions and financial health.

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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.

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