Abu Dhabi National Takaful Company PSC's (ADX:TKFL) market cap touched د.إ604m last week, benefiting both public companies who own 42% as well as institutions

Key Insights

• Significant control over Abu Dhabi National Takaful Company PSC by public companies implies that the general public has more power to influence management and governance-related decisions
• 69% of the business is held by the top 2 shareholders
• 34% of Abu Dhabi National Takaful Company PSC is held by Institutions

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Every investor in Abu Dhabi National Takaful Company PSC (ADX:TKFL) should be aware of the most powerful shareholder groups. With 42% stake, public companies possess the maximum shares in the company. Put another way, the group faces the maximum upside potential (or downside risk).

Following a 15% increase in the stock price last week, public companies profited the most, but institutions who own 34% stock also stood to gain from the increase.

In the chart below, we zoom in on the different ownership groups of Abu Dhabi National Takaful Company PSC.

See our latest analysis for Abu Dhabi National Takaful Company PSC

What Does The Institutional Ownership Tell Us About Abu Dhabi National Takaful Company PSC?

Institutions typically measure themselves against a benchmark when reporting to their own investors, so they often become more enthusiastic about a stock once it's included in a major index. We would expect most companies to have some institutions on the register, especially if they are growing.

We can see that Abu Dhabi National Takaful Company PSC does have institutional investors; and they hold a good portion of the company's stock. This implies the analysts working for those institutions have looked at the stock and they like it. But just like anyone else, they could be wrong. It is not uncommon to see a big share price drop if two large institutional investors try to sell out of a stock at the same time. So it is worth checking the past earnings trajectory of Abu Dhabi National Takaful Company PSC, (below). Of course, keep in mind that there are other factors to consider, too.

Hedge funds don't have many shares in Abu Dhabi National Takaful Company PSC. Our data shows that Abu Dhabi Islamic Bank PJSC is the largest shareholder with 42% of shares outstanding. Meanwhile, the second and third largest shareholders, hold 27% and 12%, of the shares outstanding, respectively.

After doing some more digging, we found that the top 2 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 Abu Dhabi National Takaful Company PSC

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.

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.

We note our data does not show any board members holding shares, personally. Not all jurisdictions have the same rules around disclosing insider ownership, and it is possible we have missed something, here. So you can click here learn more about the CEO.

General Public Ownership

The general public, who are usually individual investors, hold a 13% stake in Abu Dhabi National Takaful Company PSC. 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 12%, of the Abu Dhabi National Takaful Company PSC stock. It might be worth looking deeper into this. If related parties, such as insiders, have an interest in one of these private companies, that should be disclosed in the annual report. Private companies may also have a strategic interest in the company.

Public Company Ownership

We can see that public companies hold 42% of the Abu Dhabi National Takaful Company PSC shares on issue. It's hard to say for sure but this suggests they have entwined business interests. This might be a strategic stake, so it's worth watching this space for changes in ownership.

Next Steps:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. Consider for instance, the ever-present spectre of investment risk. We've identified 2 warning signs with Abu Dhabi National Takaful Company PSC , and understanding them should be part of your investment process.

Of course this may not be the best stock to buy. Therefore, you may wish to see our free collection of interesting prospects boasting favorable financials.

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.