Insiders were the biggest winners as Kardan Israel Ltd's (TLV:KRDI) market cap grew by ₪72m last week
Key Insights
- Insiders appear to have a vested interest in Kardan Israel's growth, as seen by their sizeable ownership
- The top 2 shareholders own 60% of the company
- Using data from company's past performance alongside ownership research, one can better assess the future performance of a company
To get a sense of who is truly in control of Kardan Israel Ltd (TLV:KRDI), it is important to understand the ownership structure of the business. With 87% stake, individual insiders possess the maximum shares in the company. 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, insiders scored the highest last week as the company hit ₪734m market cap following a 11% gain in the stock.
Let's take a closer look to see what the different types of shareholders can tell us about Kardan Israel.
See our latest analysis for Kardan Israel
What Does The Lack Of Institutional Ownership Tell Us About Kardan Israel?
We don't tend to see institutional investors holding stock of companies that are very risky, thinly traded, or very small. Though we do sometimes see large companies without institutions on the register, it's not particularly common.
There are many reasons why a company might not have any institutions on the share registry. It may be hard for institutions to buy large amounts of shares, if liquidity (the amount of shares traded each day) is low. If the company has not needed to raise capital, institutions might lack the opportunity to build a position. It is also possible that fund managers don't own the stock because they aren't convinced it will perform well. Kardan Israel's earnings and revenue track record (below) may not be compelling to institutional investors -- or they simply might not have looked at the business closely.
We note that hedge funds don't have a meaningful investment in Kardan Israel. Looking at our data, we can see that the largest shareholder is Avner Schnur with 35% of shares outstanding. The second and third largest shareholders are Gil Deutsch and Aharon Biram, with an equal amount of shares to their name at 25%. Aharon Biram, who is the third-largest shareholder, also happens to hold the title of Member of the Board of Directors. Furthermore, CEO Alon Wulkan is the owner of 1.6% of the company's shares.
A more detailed study of the shareholder registry showed us that 2 of the top shareholders have a considerable amount of ownership in the company, via their 60% stake.
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. We're not picking up on any analyst coverage of the stock at the moment, so the company is unlikely to be widely held.
Insider Ownership Of Kardan Israel
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. The company management answer to the board and the latter should represent the interests of shareholders. Notably, sometimes top-level managers are on the board themselves.
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.
Our information suggests that insiders own more than half of Kardan Israel Ltd. This gives them effective control of the company. That means they own ₪641m worth of shares in the ₪734m company. That's quite meaningful. It is good to see this level of investment. You can check here to see if those insiders have been buying recently.
General Public Ownership
The general public-- including retail investors -- own 12% stake in the company, and hence can't easily be ignored. 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. Take risks for example - Kardan Israel has 2 warning signs (and 1 which is a bit concerning) we think you should know about.
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.