With a 57% stake, PMB Technology Berhad (KLSE:PMBTECH) insiders have a lot riding on the company

Key Insights

• PMB Technology Berhad's significant insider ownership suggests inherent interests in company's expansion

• 56% of the business is held by the top 3 shareholders

• Past performance of a company along with ownership data serve to give a strong idea about prospects for a business

Every investor in PMB Technology Berhad (KLSE:PMBTECH) should be aware of the most powerful shareholder groups. The group holding the most number of shares in the company, around 57% to be precise, is individual insiders. Put another way, the group faces the maximum upside potential (or downside risk).

So it follows, every decision made by insiders of PMB Technology Berhad regarding the company's future would be crucial to them.

In the chart below, we zoom in on the different ownership groups of PMB Technology Berhad.

See our latest analysis for PMB Technology Berhad

What Does The Institutional Ownership Tell Us About PMB Technology Berhad?

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.

Institutions have a very small stake in PMB Technology Berhad. That indicates that the company is on the radar of some funds, but it isn't particularly popular with professional investors at the moment. So if the company itself can improve over time, we may well see more institutional buyers in the future. 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.

Hedge funds don't have many shares in PMB Technology Berhad. The company's largest shareholder is Press Metal Aluminium Holdings Berhad, with ownership of 24%. In comparison, the second and third largest shareholders hold about 21% and 11% of the stock. Note that the second and third-largest shareholders are also Chief Executive Officer and Member of the Board of Directors, respectively, meaning that the company's top shareholders are insiders.

To make our study more interesting, we found that the top 3 shareholders have a majority ownership in the company, meaning that they are powerful enough to influence the decisions of the company.

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. There is some analyst coverage of the stock, but it could still become more well known, with time.

Insider Ownership Of PMB Technology Berhad

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. 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.

It seems that insiders own more than half the PMB Technology Berhad stock. This gives them a lot of power. Given it has a market cap of RM4.5b, that means they have RM2.6b 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-- including retail investors -- own 18% 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.

Public Company Ownership

Public companies currently own 24% of PMB Technology Berhad stock. This may be a strategic interest and the two companies may have related business interests. It could be that they have de-merged. This holding is probably worth investigating further.

Next Steps:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. Take risks for example - PMB Technology Berhad has 5 warning signs (and 3 which don't sit too well with us) we think you should know about.

If you would prefer discover what analysts are predicting in terms of future growth, do not miss this free report on analyst forecasts.

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.