Al Wathba National Insurance Company PJSC's (ADX:AWNIC) last week's 15% decline must have disappointed private companies who have a significant stake

Key Insights

• The considerable ownership by private companies in Al Wathba National Insurance Company PJSC indicates that they collectively have a greater say in management and business strategy
• The top 3 shareholders own 52% of the company
• Insider ownership in Al Wathba National Insurance Company PJSC is 22%

Every investor in Al Wathba National Insurance Company PJSC (ADX:AWNIC) should be aware of the most powerful shareholder groups. And the group that holds the biggest piece of the pie are private companies with 49% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

While insiders who own 22% came under pressure after market cap dropped to د.إ683m last week,private companies took the most losses.

Let's take a closer look to see what the different types of shareholders can tell us about Al Wathba National Insurance Company PJSC.

Check out our latest analysis for Al Wathba National Insurance Company PJSC

What Does The Institutional Ownership Tell Us About Al Wathba National Insurance Company PJSC?

Institutional investors commonly compare their own returns to the returns of a commonly followed index. So they generally do consider buying larger companies that are included in the relevant benchmark index.

Al Wathba National Insurance Company PJSC already has institutions on the share registry. Indeed, they own a respectable stake in the company. This can indicate that the company has a certain degree of credibility in the investment community. However, it is best to be wary of relying on the supposed validation that comes with institutional investors. They too, get it wrong sometimes. When multiple institutions own a stock, there's always a risk that they are in a 'crowded trade'. When such a trade goes wrong, multiple parties may compete to sell stock fast. This risk is higher in a company without a history of growth. You can see Al Wathba National Insurance Company PJSC's historic earnings and revenue below, but keep in mind there's always more to the story.

Hedge funds don't have many shares in Al Wathba National Insurance Company PJSC. Looking at our data, we can see that the largest shareholder is Darwish Bin Ahmed And Sons Group with 31% of shares outstanding. Meanwhile, the second and third largest shareholders, hold 13% and 8.2%, of the shares outstanding, respectively.

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 Al Wathba National Insurance Company PJSC

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. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.

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 information suggests that insiders maintain a significant holding in Al Wathba National Insurance Company PJSC. Insiders have a د.إ150m stake in this د.إ683m business. It is great to see insiders so invested in the business. It might be worth checking if those insiders have been buying recently.

General Public Ownership

With a 22% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Al Wathba National Insurance Company PJSC. 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.

Private Company Ownership

It seems that Private Companies own 49%, of the Al Wathba National Insurance 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:

It's always worth thinking about the different groups who own shares in a company. But to understand Al Wathba National Insurance Company PJSC better, we need to consider many other factors. Be aware that Al Wathba National Insurance Company PJSC is showing 1 warning sign in our investment analysis , you should know about...

If you would prefer check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, backed by strong financial data.

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.