Retail investors are SHL Finance Company's (TADAWUL:1183) biggest owners and were hit after market cap dropped ر.س190m
Key Insights
- Significant control over SHL Finance by retail investors implies that the general public has more power to influence management and governance-related decisions
- The top 9 shareholders own 46% of the company
- Using data from company's past performance alongside ownership research, one can better assess the future performance of a company
If you want to know who really controls SHL Finance Company (TADAWUL:1183), then you'll have to look at the makeup of its share registry. And the group that holds the biggest piece of the pie are retail investors with 54% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).
As a result, retail investors as a group endured the highest losses last week after market cap fell by ر.س190m.
Let's delve deeper into each type of owner of SHL Finance, beginning with the chart below.
Check out our latest analysis for SHL Finance
What Does The Lack Of Institutional Ownership Tell Us About SHL Finance?
Institutional investors often avoid companies that are too small, too illiquid or too risky for their tastes. But it's unusual to see larger companies without any institutional investors.
There are multiple explanations for why institutions don't own a stock. The most common is that the company is too small relative to funds under management, so the institution does not bother to look closely at the company. On the other hand, it's always possible that professional investors are avoiding a company because they don't think it's the best place for their money. SHL Finance might not have the sort of past performance institutions are looking for, or perhaps they simply have not studied the business closely.
SHL Finance is not owned by hedge funds. Arab National Bank is currently the largest shareholder, with 29% of shares outstanding. In comparison, the second and third largest shareholders hold about 11% and 5.6% of the stock. Yousef Bin Al-Shelash, who is the third-largest shareholder, also happens to hold the title of Chairman of the Board.
Our studies suggest that the top 9 shareholders collectively control less than half of the company's shares, meaning that the company's shares are widely disseminated and there is no dominant shareholder.
While it makes sense to study institutional ownership data for a company, it also makes sense to study analyst sentiments to know which way the wind is blowing. Our information suggests that there isn't any analyst coverage of the stock, so it is probably little known.
Insider Ownership Of SHL Finance
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.
Insider ownership is positive when it signals leadership are thinking like the true owners of the company. However, high insider ownership can also give immense power to a small group within the company. This can be negative in some circumstances.
We can see that insiders own shares in SHL Finance Company. As individuals, the insiders collectively own ر.س91m worth of the ر.س1.6b company. This shows at least some alignment. You can click here to see if those insiders have been buying or selling.
General Public Ownership
The general public, who are usually individual investors, hold a substantial 54% stake in SHL Finance, suggesting it is a fairly popular stock. This level of ownership gives investors from the wider public some power to sway key policy decisions such as board composition, executive compensation, and the dividend payout ratio.
Public Company Ownership
It appears to us that public companies own 40% of SHL Finance. We can't be certain but it is quite possible this is a strategic stake. The businesses may be similar, or work together.
Next Steps:
It's always worth thinking about the different groups who own shares in a company. But to understand SHL Finance better, we need to consider many other factors. To that end, you should be aware of the 2 warning signs we've spotted with SHL Finance .
Of course this may not be the best stock to buy. So take a peek at this free free list of interesting companies.
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.