How Much Of Export Investment Co. Ltd. (TLV:EXPO) Do Insiders Own?

By
Simply Wall St
Published
August 22, 2021
TASE:EXPO
Source: Shutterstock

A look at the shareholders of Export Investment Co. Ltd. (TLV:EXPO) can tell us which group is most powerful. Large companies usually have institutions as shareholders, and we usually see insiders owning shares in smaller companies. Warren Buffett said that he likes "a business with enduring competitive advantages that is run by able and owner-oriented people." So it's nice to see some insider ownership, because it may suggest that management is owner-oriented.

Export Investment is a smaller company with a market capitalization of ₪337m, so it may still be flying under the radar of many institutional investors. Taking a look at our data on the ownership groups (below), it seems that institutional investors have not yet purchased shares. We can zoom in on the different ownership groups, to learn more about Export Investment.

View our latest analysis for Export Investment

ownership-breakdown
TASE:EXPO Ownership Breakdown August 23rd 2021

What Does The Lack Of Institutional Ownership Tell Us About Export Investment?

We don't tend to see institutional investors holding stock of companies that are very risky, thinly traded, or very small. Though we do sometimes see large companies without institutions on the register, it's not particularly common.

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. Export Investment might not have the sort of past performance institutions are looking for, or perhaps they simply have not studied the business closely.

earnings-and-revenue-growth
TASE:EXPO Earnings and Revenue Growth August 23rd 2021

Hedge funds don't have many shares in Export Investment. Kena Shoval is currently the company's largest shareholder with 75% of shares outstanding. This essentially means that they have extensive influence, if not outright control, over the future of the corporation. Itzhak Sela is the second largest shareholder owning 6.2% of common stock, and Ayalon Mutual Funds Ltd. holds about 0.2% of the company stock.

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 Export Investment

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. 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 Export Investment Co. Ltd. stock. This gives them a lot of power. That means they own ₪273m worth of shares in the ₪337m company. That's quite meaningful. 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 19% ownership, the general public have some degree of sway over Export Investment. 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:

It's always worth thinking about the different groups who own shares in a company. But to understand Export Investment better, we need to consider many other factors. Take risks for example - Export Investment has 1 warning sign we think 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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