Is The National Bank of Ras Al-Khaimah (P.S.C.) (ADX:RAKBANK) Popular Amongst Insiders?

A look at the shareholders of The National Bank of Ras Al-Khaimah (P.S.C.) (ADX:RAKBANK) can tell us which group is most powerful. Insiders often own a large chunk of younger, smaller, companies while huge companies tend to have institutions as shareholders. I generally like to see some degree of insider ownership, even if only a little. As Nassim Nicholas Taleb said, 'Don’t tell me what you think, tell me what you have in your portfolio.

National Bank of Ras Al-Khaimah (P.S.C.) has a market capitalization of د.إ6.2b, so we would expect some institutional investors to have noticed the stock. In the chart below, we can see that institutional investors have not yet purchased much of the company. Let's delve deeper into each type of owner, to discover more about National Bank of Ras Al-Khaimah (P.S.C.).

See our latest analysis for National Bank of Ras Al-Khaimah (P.S.C.)

What Does The Lack Of Institutional Ownership Tell Us About National Bank of Ras Al-Khaimah (P.S.C.)?

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. Alternatively, there might be something about the company that has kept institutional investors away. National Bank of Ras Al-Khaimah (P.S.C.) might not have the sort of past performance institutions are looking for, or perhaps they simply have not studied the business closely.

We note that hedge funds don't have a meaningful investment in National Bank of Ras Al-Khaimah (P.S.C.). Looking at our data, we can see that the largest shareholder is Government of Ras Al Khaimah with 49% of shares outstanding. For context, the second largest shareholder holds about 6.7% of the shares outstanding, followed by an ownership of 0.9% by the third-largest shareholder.

To make our study more interesting, we found that the top 2 shareholders have a majority ownership in the company, meaning that they are powerful enough to influence the decisions of the company.

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. While there is some analyst coverage, the company is probably not widely covered. So it could gain more attention, down the track.

Insider Ownership Of National Bank of Ras Al-Khaimah (P.S.C.)

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. 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.

Most consider insider ownership a positive because it can indicate the board is well aligned with other shareholders. However, on some occasions too much power is concentrated within this group.

Our most recent data indicates that insiders own some shares in The National Bank of Ras Al-Khaimah (P.S.C.). It is a pretty big company, so it is generally a positive to see some potentially meaningful alignment. In this case, they own around د.إ415m worth of shares (at current prices). Most would say this shows alignment of interests between shareholders and the board. Still, it might be worth checking if those insiders have been selling.

General Public Ownership

The general public holds a 43% stake in National Bank of Ras Al-Khaimah (P.S.C.). This size of ownership, while considerable, may not be enough to change company policy if the decision is not in sync with other large shareholders.

Next Steps:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. Case in point: We've spotted 1 warning sign for National Bank of Ras Al-Khaimah (P.S.C.) you should be aware of.

If you are like me, you may want to think about whether this company will grow or shrink. Luckily, you can check this free report showing analyst forecasts for its future.

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. 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.
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