Owning 59% in Shapir Engineering and Industry Ltd (TLV:SPEN) means that insiders are heavily invested in the company's future

Key Insights

• Insiders appear to have a vested interest in Shapir Engineering and Industry's growth, as seen by their sizeable ownership
• The top 4 shareholders own 59% of the company
• Institutions own 26% of Shapir Engineering and Industry

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A look at the shareholders of Shapir Engineering and Industry Ltd (TLV:SPEN) can tell us which group is most powerful. We can see that individual insiders own the lion's share in the company with 59% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

So it follows, every decision made by insiders of Shapir Engineering and Industry regarding the company's future would be crucial to them.

Let's take a closer look to see what the different types of shareholders can tell us about Shapir Engineering and Industry.

View our latest analysis for Shapir Engineering and Industry

What Does The Institutional Ownership Tell Us About Shapir Engineering and Industry?

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.

As you can see, institutional investors have a fair amount of stake in Shapir Engineering and Industry. 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. 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 Shapir Engineering and Industry, (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 Shapir Engineering and Industry. Because actions speak louder than words, we consider it a good sign when insiders own a significant stake in a company. In Shapir Engineering and Industry's case, its Senior Key Executive, Gil Shapira, is the largest shareholder, holding 15% of shares outstanding. The second and third largest shareholders are Israel Shapira and Chen Shapira, with an equal amount of shares to their name at 15%. Note that two of the top three shareholders are also Senior Key Executive and Member of the Board of Directors, respectively, once again pointing to significant ownership by company insiders. Furthermore, CEO Harel Shapira is the owner of 15% of the company's shares.

After doing some more digging, we found that the top 4 shareholders control more than half of the company's shares which essentially means that there is concentrated ownership amongst the top shareholders, most of whom happen to be insiders!

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 Shapir Engineering and Industry

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. 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 most recent data indicates that insiders own the majority of Shapir Engineering and Industry Ltd. This means they can collectively make decisions for the company. Given it has a market cap of ₪9.8b, that means insiders have a whopping ₪5.7b worth of shares in their own names. It is good to see this level of investment. You can check here to see if those insiders have been selling any of their shares.

General Public Ownership

With a 15% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Shapir Engineering and Industry. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.

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. Take risks for example - Shapir Engineering and Industry has 3 warning signs (and 2 which make us uncomfortable) we think you should know about.

Of course this may not be the best stock to buy. Therefore, you may wish to see our free collection of interesting prospects boasting favorable financials.

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.