Both private companies who control a good portion of Mizrahi Tefahot Bank Ltd. (TLV:MZTF) along with institutions must be dismayed after last week's 4.5% decrease

Key Insights

• The considerable ownership by private companies in Mizrahi Tefahot Bank indicates that they collectively have a greater say in management and business strategy
• The top 5 shareholders own 55% of the company
• 40% of Mizrahi Tefahot Bank is held by Institutions

A look at the shareholders of Mizrahi Tefahot Bank Ltd. (TLV:MZTF) can tell us which group is most powerful. The group holding the most number of shares in the company, around 49% to be precise, is private companies. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

Following a 4.5% decrease in the stock price last week, private companies suffered the most losses, but institutions who own 40% stock also took a hit.

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

Check out our latest analysis for Mizrahi Tefahot Bank

What Does The Institutional Ownership Tell Us About Mizrahi Tefahot Bank?

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.

Mizrahi Tefahot Bank already has institutions on the share registry. Indeed, they own a respectable stake in the company. 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 Mizrahi Tefahot Bank, (below). Of course, keep in mind that there are other factors to consider, too.

We note that hedge funds don't have a meaningful investment in Mizrahi Tefahot Bank. Looking at our data, we can see that the largest shareholder is L.I.N Holdings Ltd with 21% of shares outstanding. In comparison, the second and third largest shareholders hold about 13% and 7.3% of the stock.

On looking further, we found that 55% of the shares are owned by the top 5 shareholders. In other words, these shareholders have a meaningful say in the decisions of the company.

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. There is a little analyst coverage of the stock, but not much. So there is room for it to gain more coverage.

Insider Ownership Of Mizrahi Tefahot Bank

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.

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.

We note our data does not show any board members holding shares, personally. Given we are not picking up on insider ownership, we may have missing data. Therefore, it would be interesting to assess the CEO compensation and tenure, here.

General Public Ownership

The general public-- including retail investors -- own 11% stake in the company, and hence can't easily be ignored. 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

Our data indicates that Private Companies hold 49%, of the company's shares. 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.

Next Steps:

I find it very interesting to look at who exactly owns a company. But to truly gain insight, we need to consider other information, too. Consider risks, for instance. Every company has them, and we've spotted 1 warning sign for Mizrahi Tefahot Bank you should know about.

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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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.