The recent ₪345m market cap decrease is likely to have disappointed insiders invested in Electreon Wireless Ltd (TLV:ELWS)

Key Insights

• Electreon Wireless' significant insider ownership suggests inherent interests in company's expansion
• The top 5 shareholders own 57% of the company
• Institutions own 14% of Electreon Wireless

Every investor in Electreon Wireless Ltd (TLV:ELWS) should be aware of the most powerful shareholder groups. With 57% stake, individual insiders possess the maximum shares in the company. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

As market cap fell to ₪2.1b last week, insiders would have faced the highest losses than any other shareholder groups of the company.

Let's delve deeper into each type of owner of Electreon Wireless, beginning with the chart below.

View our latest analysis for Electreon Wireless

What Does The Institutional Ownership Tell Us About Electreon Wireless?

Institutional investors commonly compare their own returns to the returns of a commonly followed index. So they generally do consider buying larger companies that are included in the relevant benchmark index.

Electreon Wireless already has institutions on the share registry. Indeed, they own a respectable stake in the company. This can indicate that the company has a certain degree of credibility in the investment community. However, it is best to be wary of relying on the supposed validation that comes with institutional investors. They too, get it wrong sometimes. 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 Electreon Wireless' earnings history below. Of course, the future is what really matters.

Electreon Wireless is not owned by hedge funds. Yizhaq Hajaj is currently the company's largest shareholder with 15% of shares outstanding. The second and third largest shareholders are Oren Ezer and Hanan Rumbak, with an equal amount of shares to their name at 14%. Oren Ezer, who is the second-largest shareholder, also happens to hold the title of Chief Executive Officer.

On looking further, we found that 57% 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.

While it makes sense to study institutional ownership data for a company, it also makes sense to study analyst sentiments to know which way the wind is blowing. As far as we can tell there isn't analyst coverage of the company, so it is probably flying under the radar.

Insider Ownership Of Electreon Wireless

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.

Most consider insider ownership a positive because it can indicate the board is well aligned with other shareholders. However, on some occasions too much power is concentrated within this group.

Our information suggests that insiders own more than half of Electreon Wireless Ltd. This gives them effective control of the company. Given it has a market cap of ₪2.1b, that means they have ₪1.2b worth of shares. It is good to see this level of investment. You can check here to see if those insiders have been buying recently.

General Public Ownership

The general public-- including retail investors -- own 24% 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

It seems that Private Companies own 5.1%, of the Electreon Wireless 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.

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. Case in point: We've spotted 2 warning signs for Electreon Wireless you should be aware of, and 1 of them shouldn't be ignored.

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.