Institutional investors may overlook Bet Shemesh Engines Holdings (1997) Ltd's (TLV:BSEN) recent ₪307m market cap drop as long-term gains remain positive

Key Insights

• Significantly high institutional ownership implies Bet Shemesh Engines Holdings (1997)'s stock price is sensitive to their trading actions
• A total of 5 investors have a majority stake in the company with 51% ownership
• Ownership research, combined with past performance data can help provide a good understanding of opportunities in a stock

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A look at the shareholders of Bet Shemesh Engines Holdings (1997) Ltd (TLV:BSEN) can tell us which group is most powerful. And the group that holds the biggest piece of the pie are institutions with 46% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

Losing money on investments is something no shareholder enjoys, least of all institutional investors who saw their holdings value drop by 4.7% last week. Still, the 157% one-year gains may have helped mitigate their overall losses. But they would probably be wary of future losses.

Let's take a closer look to see what the different types of shareholders can tell us about Bet Shemesh Engines Holdings (1997).

See our latest analysis for Bet Shemesh Engines Holdings (1997)

What Does The Institutional Ownership Tell Us About Bet Shemesh Engines Holdings (1997)?

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.

Bet Shemesh Engines Holdings (1997) already has institutions on the share registry. Indeed, they own a respectable stake in the company. This suggests some credibility amongst professional investors. But we can't rely on that fact alone since institutions make bad investments sometimes, just like everyone does. 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 Bet Shemesh Engines Holdings (1997)'s historic earnings and revenue below, but keep in mind there's always more to the story.

Bet Shemesh Engines Holdings (1997) is not owned by hedge funds. First Israel Mezzanine Investors Ltd. is currently the company's largest shareholder with 26% of shares outstanding. In comparison, the second and third largest shareholders hold about 8.7% and 7.4% of the stock.

Our research also brought to light the fact that roughly 51% of the company is controlled by the top 5 shareholders suggesting that these owners wield significant influence on the business.

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. Our information suggests that there isn't any analyst coverage of the stock, so it is probably little known.

Insider Ownership Of Bet Shemesh Engines Holdings (1997)

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.

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

With a 28% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Bet Shemesh Engines Holdings (1997). While this size of ownership may not be enough to sway a policy decision in their favour, they can still make a collective impact on company policies.

Private Equity Ownership

Private equity firms hold a 26% stake in Bet Shemesh Engines Holdings (1997). This suggests they can be influential in key policy decisions. Some investors might be encouraged by this, since private equity are sometimes able to encourage strategies that help the market see the value in the company. Alternatively, those holders might be exiting the investment after taking it public.

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 3 warning signs for Bet Shemesh Engines Holdings (1997) (1 shouldn't be ignored) that 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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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.