The big shareholder groups in Nisun International Enterprise Development Group Co., Ltd (NASDAQ:NISN) have power over the company. Institutions often own shares in more established companies, while it’s not unusual to see insiders own a fair bit of smaller companies. I generally like to see some degree of insider ownership, even if only a little. As Nassim Nicholas Taleb said, ‘Don’t tell me what you think, tell me what you have in your portfolio.

Nisun International Enterprise Development Group is not a large company by global standards. It has a market capitalization of US$382m, which means it wouldn’t have the attention of many institutional investors. Taking a look at our data on the ownership groups (below), it seems that institutions are noticeable on the share registry. Let’s delve deeper into each type of owner, to discover more about Nisun International Enterprise Development Group.

View our latest analysis for Nisun International Enterprise Development Group

ownership-breakdown

NasdaqCM:NISN Ownership Breakdown January 25th 2021

What Does The Institutional Ownership Tell Us About Nisun International Enterprise Development Group?

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 Nisun International Enterprise Development Group. 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 Nisun International Enterprise Development Group’s historic earnings and revenue below, but keep in mind there’s always more to the story.

earnings-and-revenue-growth

NasdaqCM:NISN Earnings and Revenue Growth January 25th 2021

We note that hedge funds don’t have a meaningful investment in Nisun International Enterprise Development Group. Our data shows that Bodang Liu is the largest shareholder with 44% of shares outstanding. Jinbao Li is the second largest shareholder owning 8.9% of common stock, and Apex Trading Group Inc, Asset Management Arm holds about 7.0% of the company stock.

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. We’re not picking up on any analyst coverage of the stock at the moment, so the company is unlikely to be widely held.

Insider Ownership Of Nisun International Enterprise Development Group

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 own more than half of Nisun International Enterprise Development Group Co., Ltd. This gives them effective control of the company. Given it has a market cap of US$382m, that means they have US$231m worth of shares. Most would be pleased to see the board is investing alongside them. You may wish todiscover (for free) if they have been buying or selling.

General Public Ownership

The general public holds a 26% stake in Nisun International Enterprise Development Group. 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.

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 Nisun International Enterprise Development Group is showing 3 warning signs in our investment analysis , and 1 of those is significant…

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this 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. 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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