Stock Analysis

Gulf Medical Projects Company (PJSC) (ADX:GMPC) insiders, who hold 64% of the firm would be disappointed by the recent pullback

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ADX:GMPC
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A look at the shareholders of Gulf Medical Projects Company (PJSC) (ADX:GMPC) can tell us which group is most powerful. And the group that holds the biggest piece of the pie are individual insiders with 64% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

And following last week's 18% decline in share price, insiders suffered the most losses.

In the chart below, we zoom in on the different ownership groups of Gulf Medical Projects Company (PJSC).

Check out the opportunities and risks within the XX Healthcare industry.

ownership-breakdown
ADX:GMPC Ownership Breakdown December 9th 2022

What Does The Lack Of Institutional Ownership Tell Us About Gulf Medical Projects Company (PJSC)?

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 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. 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. Gulf Medical Projects Company (PJSC)'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.

earnings-and-revenue-growth
ADX:GMPC Earnings and Revenue Growth December 9th 2022

Gulf Medical Projects Company (PJSC) is not owned by hedge funds. Salem Abdulla Al Hosani is currently the company's largest shareholder with 34% of shares outstanding. Meanwhile, the second and third largest shareholders, hold 12% and 11%, of the shares outstanding, respectively. Majid Bin Faisal Al Qassimi, who is the third-largest shareholder, also happens to hold the title of Member of the Board of Directors.

After doing some more digging, we found that the top 3 shareholders collectively control more than half of the company's shares, implying that they have considerable power to influence the company's decisions.

Researching institutional ownership is a good way to gauge and filter a stock's expected performance. The same can be achieved by studying analyst sentiments. 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 Gulf Medical Projects Company (PJSC)

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. 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.

It seems that insiders own more than half the Gulf Medical Projects Company (PJSC) stock. This gives them a lot of power. Given it has a market cap of د.إ1.1b, that means they have د.إ735m worth of shares. Most would argue this is a positive, showing strong alignment with shareholders. You can click here to see if those insiders have been buying or selling.

General Public Ownership

With a 25% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Gulf Medical Projects Company (PJSC). While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.

Private Company Ownership

It seems that Private Companies own 11%, of the Gulf Medical Projects Company (PJSC) stock. Private companies may be related parties. Sometimes insiders have an interest in a public company through a holding in a private company, rather than in their own capacity as an individual. While it's hard to draw any broad stroke conclusions, it is worth noting as an area for further research.

Next Steps:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. For instance, we've identified 2 warning signs for Gulf Medical Projects Company (PJSC) that you should be aware of.

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this 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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