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Key Insights

• The considerable ownership by public companies in MGB Berhad indicates that they collectively have a greater say in management and business strategy

• The largest shareholder of the company is LBS Bina Group Berhad with a 58% stake

• 17% of MGB Berhad is held by insiders

A look at the shareholders of MGB Berhad (KLSE:MGB) can tell us which group is most powerful. We can see that public companies own the lion's share in the company with 58% 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 insiders make up 17% of the company’s shareholders. Institutions often own shares in more established companies, while it's not unusual to see insiders own a fair bit of smaller companies.

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

View our latest analysis for MGB Berhad

What Does The Institutional Ownership Tell Us About MGB Berhad?

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.

We can see that MGB Berhad does have institutional investors; and they hold a good portion of the company's stock. 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 MGB Berhad, (below). Of course, keep in mind that there are other factors to consider, too.

Hedge funds don't have many shares in MGB Berhad. The company's largest shareholder is LBS Bina Group Berhad, with ownership of 58%. This essentially means that they have extensive influence, if not outright control, over the future of the corporation. Meanwhile, the second and third largest shareholders, hold 14% and 3.2%, of the shares outstanding, respectively. Lit Lim, who is the second-largest shareholder, also happens to hold the title of Chief Executive Officer.

While studying institutional ownership for a company can add value to your research, it is also a good practice to research analyst recommendations to get a deeper understand of a stock's expected performance. There is some analyst coverage of the stock, but it could still become more well known, with time.