The recent 10% gain must have brightened the week for Top Key Executive Say Swee How, Power Root Berhad’s most optimistic insider (KLSE:PWROOT)

A look at the shareholders of Power Root Berhad (KLSE: PWROOT) can tell us which group is the most powerful. And the group that holds the biggest slice of the pie are individual insiders with 51% ownership. In other words, the group is likely to gain the most (or lose the most) from its investment in the business.

As a result, insiders were the main beneficiaries of last week’s 10% gain.

Let’s take a closer look at what different types of shareholders can tell us about Power Root Berhad.

Our analysis indicates that PWROOT is potentially undervalued!

KLSE: PWROOT Ownership Breakdown October 11, 2022

What does institutional ownership tell us about Power Root 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.

As you can see, institutional investors hold a sizeable share of Power Root Berhad. This implies that analysts working for these institutions have reviewed the stock and like it. But like everyone else, they can be wrong. If multiple institutions change their minds on a stock at the same time, you could see the stock price drop quickly. So it is worth checking out the Power Root Berhad Earnings History below. Of course, the future is what really matters.

earnings-and-revenue-growth
KLSE: PWROOT Earnings and Revenue Growth October 11, 2022

Power Root Berhad is not owned by hedge funds. Because actions speak louder than words, we consider it a good sign when insiders hold a significant stake in a company. In the case of Power Root Berhad, its top executive, Say Swee How, is the largest shareholder, holding 19% of the outstanding shares. Meanwhile, the second and third largest shareholders hold 19% and 11% of the outstanding shares respectively. Interestingly, the second largest shareholder, Fuei Boon Wong, is also Top Key Executive, again, indicating strong insider ownership among the company’s top shareholders. Additionally, CEO Tak Keong Wong owns 9.9% of the company’s shares.

Looking further, we found that 59% of the shares are held by the top 4 shareholders. In other words, these shareholders have a say in the decisions of the company.

While it makes sense to study data on a company’s institutional ownership, it also makes sense to study analyst sentiment to find out which way the wind is blowing. There are a reasonable number of analysts covering the stock, so it might be useful to know their overall view on the future.

Power Root Berhad Insider Ownership

The definition of company insiders can be subjective and varies from jurisdiction to jurisdiction. Our data reflects individual insiders, capturing at least board members. The management of the company runs the company, but the CEO will answer to the board of directors, even if he is a member of it.

I generally consider insider ownership to be a good thing. However, there are times when it is more difficult for other shareholders to hold the board accountable for decisions.

It appears that insiders own more than half of the shares of Power Root Berhad. It gives them a lot of power. So they have a stake of RM436 million in this RM854 million business. Most would say this is a positive, showing strong alignment with shareholders. You can click here to see if these insiders have been buying or selling.

General public property

The general public, including retail investors, owns 13% of the company’s capital and therefore cannot be easily ignored. Although this group may not necessarily make the decisions, they can certainly have a real influence on the way the business is run.

Private Company Ownership

Private companies appear to own 12% of the shares of Power Root Berhad. Private companies can be related parties. Sometimes insiders have an interest in a public company through an equity stake in a private company, rather than in their own capacity as individuals. Although it is difficult to draw general conclusions, it should be noted that this is an area for further research.

Next steps:

While it is worth considering the different groups that own a business, there are other, even more important factors. Be aware that Power Root Berhad displays 1 warning sign in our investment analysis you should know…

If you prefer to find out what analysts are predicting in terms of future growth, don’t miss this free analyst forecast report.

NB: The figures in this article are calculated using trailing twelve month data, which refers to the 12 month period ending on the last day of the month the financial statements are dated. This may not be consistent with the annual report figures for the full year.

This Simply Wall St article is general in nature. We provide commentary based on historical data and analyst forecasts only using unbiased methodology and our articles are not intended to be financial advice. It is not a recommendation to buy or sell stocks and does not take into account your objectives or financial situation. Our goal is to bring you targeted long-term analysis based on fundamental data. Note that our analysis may not take into account the latest announcements from price-sensitive companies or qualitative materials. Simply Wall St has no position in the stocks mentioned.

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