Institutional investors are Gilat Satellite Networks Ltd.'s (NASDAQ:GILT) biggest bettors and were rewarded after last week's US$52m market cap gain
Key Insights
- Institutions' substantial holdings in Gilat Satellite Networks implies that they have significant influence over the company's share price
- A total of 15 investors have a majority stake in the company with 50% ownership
- Using data from analyst forecasts alongside ownership research, one can better assess the future performance of a company
If you want to know who really controls Gilat Satellite Networks Ltd. (NASDAQ:GILT), then you'll have to look at the makeup of its share registry. With 60% stake, institutions possess the maximum shares in the company. Put another way, the group faces the maximum upside potential (or downside risk).
And as as result, institutional investors reaped the most rewards after the company's stock price gained 7.1% last week. The one-year return on investment is currently 98% and last week's gain would have been more than welcomed.
Let's take a closer look to see what the different types of shareholders can tell us about Gilat Satellite Networks.
View our latest analysis for Gilat Satellite Networks
What Does The Institutional Ownership Tell Us About Gilat Satellite Networks?
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.
We can see that Gilat Satellite Networks 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. 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 Gilat Satellite Networks, (below). Of course, keep in mind that there are other factors to consider, too.
Investors should note that institutions actually own more than half the company, so they can collectively wield significant power. We note that hedge funds don't have a meaningful investment in Gilat Satellite Networks. The company's largest shareholder is Phoenix Investments & Finances Ltd, with ownership of 14%. Migdal Mutual Funds Ltd. is the second largest shareholder owning 9.1% of common stock, and Clal Financial Management Ltd holds about 6.5% of the company stock.
A closer look at our ownership figures suggests that the top 15 shareholders have a combined ownership of 50% implying that no single shareholder has a majority.
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. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.
Insider Ownership Of Gilat Satellite Networks
The definition of company insiders can be subjective and does vary between jurisdictions. Our data reflects individual insiders, capturing board members at the very least. 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 note our data does not show any board members holding shares, personally. It is unusual not to have at least some personal holdings by board members, so our data might be flawed. A good next step would be to check how much the CEO is paid.
General Public Ownership
With a 40% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Gilat Satellite Networks. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.
Next Steps:
I find it very interesting to look at who exactly owns a company. But to truly gain insight, we need to consider other information, too. For example, we've discovered 1 warning sign for Gilat Satellite Networks that you should be aware of before investing here.
Ultimately the future is most important. You can access this free report on analyst forecasts for the company.
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.