Individual investors own 29% of Bumi Armada Berhad (KLSE:ARMADA) shares but private companies control 41% of the company

editorial-team@simplywallst.com (Simply Wall St)

Thu, Oct 10, 2024, 7:12 PM 4 min read

Key Insights

The considerable ownership by private companies in Bumi Armada Berhad indicates that they collectively have a greater say in management and business strategy
A total of 3 investors have a majority stake in the company with 52% ownership
Institutions own 15% of Bumi Armada Berhad

A look at the shareholders of Bumi Armada Berhad (KLSE:ARMADA) can tell us which group is most powerful. With 41% stake, private companies possess the maximum shares in the company. Put another way, the group faces the maximum upside potential (or downside risk).

Individual investors, on the other hand, account for 29% of the company's stockholders.

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

View our latest analysis for Bumi Armada Berhad

ownership-breakdown — KLSE:ARMADA Ownership Breakdown October 11th 2024

What Does The Institutional Ownership Tell Us About Bumi Armada 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.

We can see that Bumi Armada Berhad does have institutional investors; and they hold a good portion of the company's stock. 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. 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 Bumi Armada Berhad's earnings history below. Of course, the future is what really matters.

earnings-and-revenue-growth — KLSE:ARMADA Earnings and Revenue Growth October 11th 2024

We note that hedge funds don't have a meaningful investment in Bumi Armada Berhad. Objeklif Bersatu Sdn Bhd is currently the largest shareholder, with 35% of shares outstanding. For context, the second largest shareholder holds about 13% of the shares outstanding, followed by an ownership of 4.0% by the third-largest shareholder. Furthermore, CEO Gary Christenson is the owner of 0.7% of the company's shares.

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 52% 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. There are a reasonable number of analysts covering the stock, so it might be useful to find out their aggregate view on the future.

Insider Ownership Of Bumi Armada 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.

We can report that insiders do own shares in Bumi Armada Berhad. In their own names, insiders own RM60m worth of stock in the RM3.0b company. It is good to see some investment by insiders, but it might be worth checking if those insiders have been buying.

General Public Ownership

With a 29% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Bumi Armada 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.

Private Company Ownership

Our data indicates that Private Companies hold 41%, of the company's shares. It's hard to draw any conclusions from this fact alone, so its worth looking into who owns those private companies. Sometimes insiders or other related parties have an interest in shares in a public company through a separate private company.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Bumi Armada Berhad better, we need to consider many other factors. Consider risks, for instance. Every company has them, and we've spotted 2 warning signs for Bumi Armada Berhad you should know about.

But ultimately it is the future, not the past, that will determine how well the owners of this business will do. Therefore we think it advisable to take a look at this free report showing whether analysts are predicting a brighter future.

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.

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