With a 62% stake, CB Industrial Product Holding Berhad (KLSE:CBIP) insiders have a lot riding on the company
Key Insights
Insiders appear to have a vested interest in CB Industrial Product Holding Berhad's growth, as seen by their sizeable ownership
A total of 3 investors have a majority stake in the company with 53% ownership
Using data from company's past performance alongside ownership research, one can better assess the future performance of a company
Every investor in CB Industrial Product Holding Berhad (KLSE:CBIP) should be aware of the most powerful shareholder groups. We can see that individual insiders own the lion's share in the company with 62% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.
So it follows, every decision made by insiders of CB Industrial Product Holding Berhad regarding the company's future would be crucial to them.
In the chart below, we zoom in on the different ownership groups of CB Industrial Product Holding Berhad.
See our latest analysis for CB Industrial Product Holding Berhad
What Does The Institutional Ownership Tell Us About CB Industrial Product Holding 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.
CB Industrial Product Holding Berhad already has institutions on the share registry. Indeed, they own a respectable stake in the company. 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. 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 CB Industrial Product Holding Berhad, (below). Of course, keep in mind that there are other factors to consider, too.
Hedge funds don't have many shares in CB Industrial Product Holding Berhad. With a 43% stake, CEO Chai Lim is the largest shareholder. Yacktman Asset Management LP is the second largest shareholder owning 5.5% of common stock, and Chai Lim holds about 4.7% of the company stock. Interestingly, the third-largest shareholder, Chai Lim is also a Member of the Board of Directors, again, indicating strong insider ownership amongst the company's top shareholders.
A more detailed study of the shareholder registry showed us that 3 of the top shareholders have a considerable amount of ownership in the company, via their 53% stake.
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. As far as we can tell there isn't analyst coverage of the company, so it is probably flying under the radar.
Insider Ownership Of CB Industrial Product Holding Berhad
The definition of an insider can differ slightly between different countries, but members of the board of directors always count. 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.
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 CB Industrial Product Holding Berhad stock. This gives them a lot of power. Given it has a market cap of RM670m, that means they have RM416m worth of shares. 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-- including retail investors -- own 29% stake in the company, and hence can't easily be ignored. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.
Next Steps:
It's always worth thinking about the different groups who own shares in a company. But to understand CB Industrial Product Holding Berhad better, we need to consider many other factors. For instance, we've identified 1 warning sign for CB Industrial Product Holding Berhad that you should be aware of.
Of course this may not be the best stock to buy. Therefore, you may wish to see our free collection of interesting prospects boasting favorable financials.
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.
