While individual investors own 28% of Chunghwa Telecom Co., Ltd. (TWSE:2412), state or government are its largest shareholders with 43% ownership

Key Insights

• Chunghwa Telecom's significant state or government ownership suggests that the key decisions are influenced by shareholders from the larger public
• The top 4 shareholders own 52% of the company
• Institutional ownership in Chunghwa Telecom is 23%

If you want to know who really controls Chunghwa Telecom Co., Ltd. (TWSE:2412), then you'll have to look at the makeup of its share registry. And the group that holds the biggest piece of the pie are state or government with 43% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

Meanwhile, individual investors make up 28% of the company’s shareholders.

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

Check out our latest analysis for Chunghwa Telecom

What Does The Institutional Ownership Tell Us About Chunghwa Telecom?

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 Chunghwa Telecom. This implies the analysts working for those institutions have looked at the stock and they like it. But just like anyone else, they could be wrong. If multiple institutions change their view on a stock at the same time, you could see the share price drop fast. It's therefore worth looking at Chunghwa Telecom's earnings history below. Of course, the future is what really matters.

Chunghwa Telecom is not owned by hedge funds. Looking at our data, we can see that the largest shareholder is Ministry of Transportation and Communications R.O.C. with 35% of shares outstanding. Meanwhile, the second and third largest shareholders, hold 7.5% and 4.9%, of the shares outstanding, respectively.

To make our study more interesting, we found that the top 4 shareholders control more than half of the company which implies that this group has considerable sway over the company's decision-making.

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. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.

Insider Ownership Of Chunghwa Telecom

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. Management ultimately answers to the board. However, it is not uncommon for managers to be executive board members, especially if they are a founder or the CEO.

Most consider insider ownership a positive because it can indicate the board is well aligned with other shareholders. However, on some occasions too much power is concentrated within this group.

Our data suggests that insiders own under 1% of Chunghwa Telecom Co., Ltd. in their own names. We do note, however, it is possible insiders have an indirect interest through a private company or other corporate structure. As it is a large company, we'd only expect insiders to own a small percentage of it. But it's worth noting that they own NT$200m worth of shares. It is good to see board members owning shares, but it might be worth checking if those insiders have been buying.

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:

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 - Chunghwa Telecom has 1 warning sign we think you should be aware of.

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.