Yahoo Finance Following a 47% decline over last year, recent gains may please JinkoSolar Holding Co., Ltd. (NYSE:JKS) institutional owners
Key Insights
Given the large stake in the stock by institutions, JinkoSolar Holding's stock price might be vulnerable to their trading decisions
51% of the business is held by the top 7 shareholders
To get a sense of who is truly in control of JinkoSolar Holding Co., Ltd. (NYSE:JKS), it is important to understand the ownership structure of the business. And the group that holds the biggest piece of the pie are institutions with 37% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).
Institutional investors would appreciate the 14% increase in share price last week, given their one-year losses have totalled a disappointing 47%.
Let's delve deeper into each type of owner of JinkoSolar Holding, beginning with the chart below.
Check out our latest analysis for JinkoSolar Holding
What Does The Institutional Ownership Tell Us About JinkoSolar Holding?
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.
As you can see, institutional investors have a fair amount of stake in JinkoSolar Holding. 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. When multiple institutions own a stock, there's always a risk that they are in a 'crowded trade'. When such a trade goes wrong, multiple parties may compete to sell stock fast. This risk is higher in a company without a history of growth. You can see JinkoSolar Holding's historic earnings and revenue below, but keep in mind there's always more to the story.
JinkoSolar Holding is not owned by hedge funds. With a 18% stake, CEO Xiande Li is the largest shareholder. In comparison, the second and third largest shareholders hold about 14% and 4.8% of the stock.
On further inspection, we found that more than half the company's shares are owned by the top 7 shareholders, suggesting that the interests of the larger shareholders are balanced out to an extent by the smaller ones.
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. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.
Insider Ownership Of JinkoSolar 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.
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.
It seems insiders own a significant proportion of JinkoSolar Holding Co., Ltd.. It is very interesting to see that insiders have a meaningful US$461m stake in this US$1.3b business. It is good to see this level of investment. You can check here to see if those insiders have been buying recently.
General Public Ownership
The general public-- including retail investors -- own 28% stake in the company, and hence can't easily be ignored. While this size of ownership may not be enough to sway a policy decision in their favour, they can still make a collective impact on company policies.
Next Steps:
It's always worth thinking about the different groups who own shares in a company. But to understand JinkoSolar Holding better, we need to consider many other factors. Take risks for example - JinkoSolar Holding has 4 warning signs (and 2 which are concerning) we think you should know about.
Ultimately the future is most important. You can access this free report on analyst forecasts for the company.
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.