Following recent decline, I.B.I. Investment House Ltd's (TLV:IBI) top shareholder CEO David Lubetzky sees holdings value drop by 7.1%

Key Insights

• Insiders appear to have a vested interest in I.B.I. Investment House's growth, as seen by their sizeable ownership
• The top 3 shareholders own 58% of the company
• Using data from company's past performance alongside ownership research, one can better assess the future performance of a company

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To get a sense of who is truly in control of I.B.I. Investment House Ltd (TLV:IBI), it is important to understand the ownership structure of the business. We can see that individual insiders own the lion's share in the company with 78% ownership. Put another way, the group faces the maximum upside potential (or downside risk).

And last week, insiders endured the biggest losses as the stock fell by 7.1%.

In the chart below, we zoom in on the different ownership groups of I.B.I. Investment House.

View our latest analysis for I.B.I. Investment House

What Does The Lack Of Institutional Ownership Tell Us About I.B.I. Investment House?

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 multiple explanations for why institutions don't own a stock. The most common is that the company is too small relative to funds under management, so the institution does not bother to look closely at the company. It is also possible that fund managers don't own the stock because they aren't convinced it will perform well. Institutional investors may not find the historic growth of the business impressive, or there might be other factors at play. You can see the past revenue performance of I.B.I. Investment House, for yourself, below.

I.B.I. Investment House is not owned by hedge funds. Looking at our data, we can see that the largest shareholder is the CEO David Lubetzky with 20% of shares outstanding. For context, the second largest shareholder holds about 20% of the shares outstanding, followed by an ownership of 18% by the third-largest shareholder.

To make our study more interesting, we found that the top 3 shareholders have a majority ownership in the company, meaning that they are powerful enough to influence 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. 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 I.B.I. Investment House

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.

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 I.B.I. Investment House Ltd stock. This gives them a lot of power. That means they own ₪2.1b worth of shares in the ₪2.7b 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 21% ownership, the general public, mostly comprising of individual investors, have some degree of sway over I.B.I. Investment House. 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.

Next Steps:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. Be aware that I.B.I. Investment House is showing 1 warning sign in our investment analysis , you should know about...

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.