CPE Technology Berhad's (KLSE:CPETECH) largest shareholder, CEO Chen Lee sees holdings value fall by 13% following recent drop

Key Insights

• Significant insider control over CPE Technology Berhad implies vested interests in company growth
• A total of 3 investors have a majority stake in the company with 56% ownership
• Institutional ownership in CPE Technology Berhad is 17%

If you want to know who really controls CPE Technology Berhad (KLSE:CPETECH), then you'll have to look at the makeup of its share registry. We can see that individual insiders own the lion's share in the company with 56% ownership. Put another way, the group faces the maximum upside potential (or downside risk).

As a result, insiders as a group endured the highest losses after market cap fell by RM77m.

Let's delve deeper into each type of owner of CPE Technology Berhad, beginning with the chart below.

View our latest analysis for CPE Technology Berhad

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

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.

CPE Technology Berhad already has institutions on the share registry. Indeed, they own a respectable stake in the company. 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. 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 CPE Technology Berhad, (below). Of course, keep in mind that there are other factors to consider, too.

Hedge funds don't have many shares in CPE Technology Berhad. With a 28% stake, CEO Chen Lee is the largest shareholder. Ming Foo is the second largest shareholder owning 17% of common stock, and Woon Mu holds about 11% of the company stock. Interestingly, the third-largest shareholder, Woon Mu is also a Member of the Board of Directors, again, indicating strong insider ownership amongst the company's top shareholders.

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.

Researching institutional ownership is a good way to gauge and filter a stock's expected performance. The same can be achieved by studying analyst sentiments. 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 CPE Technology Berhad

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.

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 that insiders own more than half the CPE Technology Berhad stock. This gives them a lot of power. So they have a RM301m stake in this RM537m business. Most would argue this is a positive, showing strong alignment with shareholders. You can click here to see if those insiders have been buying or selling.

General Public Ownership

The general public, who are usually individual investors, hold a 27% stake in CPE Technology Berhad. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.

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. Case in point: We've spotted 2 warning signs for CPE Technology Berhad you should be aware of.

If you would prefer check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, backed by strong financial data.

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.