ZEAL Network SE's (ETR:TIMA) market cap dropped €63m last week; Public companies bore the brunt

Published
July 12, 2022
XTRA:TIMA
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Every investor in ZEAL Network SE (ETR:TIMA) should be aware of the most powerful shareholder groups. We can see that public companies own the lion's share in the company with 32% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

And last week, public companies endured the biggest losses as the stock fell by 7.9%.

Let's take a closer look to see what the different types of shareholders can tell us about ZEAL Network.

View our latest analysis for ZEAL Network

ownership-breakdown
XTRA:TIMA Ownership Breakdown July 12th 2022

What Does The Institutional Ownership Tell Us About ZEAL Network?

Many institutions measure their performance against an index that approximates the local market. So they usually pay more attention to companies that are included in major indices.

As you can see, institutional investors have a fair amount of stake in ZEAL Network. 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. If multiple institutions change their view on a stock at the same time, you could see the share price drop fast. It's therefore worth looking at ZEAL Network's earnings history below. Of course, the future is what really matters.

earnings-and-revenue-growth
XTRA:TIMA Earnings and Revenue Growth July 12th 2022

Our data indicates that hedge funds own 20% of ZEAL Network. That worth noting, since hedge funds are often quite active investors, who may try to influence management. Many want to see value creation (and a higher share price) in the short term or medium term. MAX Automation SE is currently the company's largest shareholder with 32% of shares outstanding. With 20% and 10% of the shares outstanding respectively, Working Capital Management Pte Ltd and Morgan Stanley, Investment Banking and Brokerage Investments are the second and third largest shareholders.

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. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.

Insider Ownership Of ZEAL Network

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.

Insider ownership is positive when it signals leadership are thinking like the true owners of the company. However, high insider ownership can also give immense power to a small group within the company. This can be negative in some circumstances.

It seems insiders own a significant proportion of ZEAL Network SE. Insiders own €84m worth of shares in the €728m company. We would say this shows alignment with shareholders, but it is worth noting that the company is still quite small; some insiders may have founded the business. You can click here to see if those insiders have been buying or selling.

General Public Ownership

With a 17% ownership, the general public, mostly comprising of individual investors, have some degree of sway over ZEAL Network. 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.

Public Company Ownership

We can see that public companies hold 32% of the ZEAL Network 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. For instance, we've identified 2 warning signs for ZEAL Network that you should be aware of.

But ultimately it is the future, not the past, that will determine how well the owners of this business will do. Therefore we think it advisable to take a look at this free report showing whether analysts are predicting a brighter 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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