Private companies among Guangdong Mingyang Electric Co.,Ltd.'s (SZSE:301291) largest shareholders, saw gain in holdings value after stock jumped 12% last week

Simply Wall St · 09/29 01:50

Key Insights

  • The considerable ownership by private companies in Guangdong Mingyang ElectricLtd indicates that they collectively have a greater say in management and business strategy
  • A total of 3 investors have a majority stake in the company with 53% ownership
  • 12% of Guangdong Mingyang ElectricLtd is held by Institutions

To get a sense of who is truly in control of Guangdong Mingyang Electric Co.,Ltd. (SZSE:301291), it is important to understand the ownership structure of the business. With 53% stake, private companies possess the maximum shares in the company. 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, private companies were the biggest beneficiaries of last week’s 12% gain.

Let's delve deeper into each type of owner of Guangdong Mingyang ElectricLtd, beginning with the chart below.

See our latest analysis for Guangdong Mingyang ElectricLtd

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SZSE:301291 Ownership Breakdown September 29th 2024

What Does The Institutional Ownership Tell Us About Guangdong Mingyang ElectricLtd?

Many institutions measure their performance against an index that approximates the local market. So they usually pay more attention to companies that are included in major indices.

As you can see, institutional investors have a fair amount of stake in Guangdong Mingyang ElectricLtd. 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 Guangdong Mingyang ElectricLtd's earnings history below. Of course, the future is what really matters.

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SZSE:301291 Earnings and Revenue Growth September 29th 2024

We note that hedge funds don't have a meaningful investment in Guangdong Mingyang ElectricLtd. Zhongshan Mingyang Electric Appliance Co., Ltd. is currently the largest shareholder, with 42% of shares outstanding. Xianqing Guo is the second largest shareholder owning 5.6% of common stock, and Zhongshan Huizhong Enterprise Management Consulting Partnership Enterprise (Limited Partnership) holds about 5.1% of the company stock. Xianqing Guo, who is the second-largest shareholder, also happens to hold the title of Chief Executive Officer.

After doing some more digging, we found that the top 3 shareholders collectively control more than half of the company's shares, implying that they have considerable power to influence the company's decisions.

While studying institutional ownership for a company can add value to your research, it is also a good practice to research analyst recommendations to get a deeper understand of a stock's expected performance. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.

Insider Ownership Of Guangdong Mingyang ElectricLtd

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. 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 report that insiders do own shares in Guangdong Mingyang Electric Co.,Ltd.. This is a big company, so it is good to see this level of alignment. Insiders own CN¥602m worth of shares (at current prices). If you would like to explore the question of insider alignment, you can click here to see if insiders have been buying or selling.

General Public Ownership

The general public-- including retail investors -- own 24% stake in the company, and hence can't easily be ignored. This size of ownership, while considerable, may not be enough to change company policy if the decision is not in sync with other large shareholders.

Private Equity Ownership

Private equity firms hold a 5.0% stake in Guangdong Mingyang ElectricLtd. This suggests they can be influential in key policy decisions. Some might like this, because private equity are sometimes activists who hold management accountable. But other times, private equity is selling out, having taking the company public.

Private Company Ownership

We can see that Private Companies own 53%, of the shares on issue. 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:

It's always worth thinking about the different groups who own shares in a company. But to understand Guangdong Mingyang ElectricLtd better, we need to consider many other factors. For example, we've discovered 2 warning signs for Guangdong Mingyang ElectricLtd (1 is a bit concerning!) that you should be aware of before investing here.

But ultimately it is the future, not the past, that will determine how well the owners of this business will do. Therefore we think it advisable to take a look at this free report showing whether analysts are predicting a brighter future.

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.