PMB Technology Berhad's (KLSE:PMBTECH) top holders are insiders and they are likely disappointed by the recent 5.6% drop

Key Insights

• PMB Technology Berhad's significant insider ownership suggests inherent interests in company's expansion
• 55% 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

A look at the shareholders of PMB Technology Berhad (KLSE:PMBTECH) can tell us which group is most powerful. With 57% stake, individual insiders possess the maximum shares in the company. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

And following last week's 5.6% decline in share price, insiders suffered the most losses.

Let's take a closer look to see what the different types of shareholders can tell us about 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.

We note that hedge funds don't have a meaningful investment in PMB Technology Berhad. Looking at our data, we can see that the largest shareholder is Press Metal Aluminium Holdings Berhad with 24% of shares outstanding. For context, the second largest shareholder holds about 21% of the shares outstanding, followed by an ownership of 11% by the third-largest shareholder. 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.

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. There is a little analyst coverage of the stock, but not much. So there is room for it to gain more coverage.

Insider Ownership Of PMB Technology Berhad

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 the majority of PMB Technology Berhad. This means they can collectively make decisions for the company. So they have a RM2.3b stake in this RM4.0b 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, who are usually individual investors, hold a 18% stake in PMB Technology Berhad. 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.

Public Company Ownership

We can see that public companies hold 24% of the PMB Technology Berhad shares on issue. It's hard to say for sure but this suggests they have entwined business interests. This might be a strategic stake, so it's worth watching this space for changes in ownership.

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 PMB Technology Berhad is showing 3 warning signs in our investment analysis , and 1 of those is a bit concerning...

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.