To get a sense of who is truly in control of Zheneng Jinjiang Environment Holding Company Limited (SGX:BWM), it is important to understand the ownership structure of the business. With 55% stake, private companies possess the maximum shares in the company. Put another way, the group faces the maximum upside potential (or downside risk).
As a result, private companies collectively scored the highest last week as the company hit S$647m market cap following a 11% gain in the stock.
Let’s delve deeper into each type of owner of Zheneng Jinjiang Environment Holding, beginning with the chart below.
What Does The Institutional Ownership Tell Us About Zheneng Jinjiang Environment Holding?
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.
Zheneng Jinjiang Environment Holding already has institutions on the share registry. Indeed, they own a respectable stake in the company. This can indicate that the company has a certain degree of credibility in the investment community. However, it is best to be wary of relying on the supposed validation that comes with institutional investors. They too, get it wrong sometimes. It is not uncommon to see a big share price drop if two large institutional investors try to sell out of a stock at the same time. So it is worth checking the past earnings trajectory of Zheneng Jinjiang Environment Holding, (below). Of course, keep in mind that there are other factors to consider, too.
Hedge funds don’t have many shares in Zheneng Jinjiang Environment Holding. The company’s largest shareholder is Zhejiang Provincial Energy Group Company Ltd., with ownership of 30%. With 23% and 15% of the shares outstanding respectively, Hangzhou Jinjiang Group Co., Ltd. and Harvest Fund Management Co., Ltd. are the second and third largest shareholders.
After doing some more digging, we found that the top 2 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. 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 Zheneng Jinjiang Environment Holding
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.
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 some shares in Zheneng Jinjiang Environment Holding Company Limited. As individuals, the insiders collectively own S$8.0m worth of the S$647m company. This shows at least some alignment. You can click here to see if those insiders have been buying or selling.
General Public Ownership
With a 11% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Zheneng Jinjiang Environment Holding. 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 18% stake in Zheneng Jinjiang Environment Holding. This suggests they can be influential in key policy decisions. Sometimes we see private equity stick around for the long term, but generally speaking they have a shorter investment horizon and — as the name suggests — don’t invest in public companies much. After some time they may look to sell and redeploy capital elsewhere.
Private Company Ownership
It seems that Private Companies own 55%, of the Zheneng Jinjiang Environment Holding stock. 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.
While it is well worth considering the different groups that own a company, there are other factors that are even more important. For example, we’ve discovered 3 warning signs for Zheneng Jinjiang Environment Holding (2 can’t be ignored!) that you should be aware of before investing here.
Of course this may not be the best stock to buy. So take a peek at this free free list of interesting companies.
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.