A look at the shareholders of E.N. Shoham Business Ltd (TLV:SHOM) can tell us which group is most powerful. Generally speaking, as a company grows, institutions will increase their ownership. Conversely, insiders often decrease their ownership over time. I quite like to see at least a little bit of insider ownership. As Charlie Munger said 'Show me the incentive and I will show you the outcome.
With a market capitalization of ₪347m, E.N. Shoham Business is a small cap stock, so it might not be well known by many institutional investors. Taking a look at our data on the ownership groups (below), it seems that institutions own shares in the company. Let's delve deeper into each type of owner, to discover more about E.N. Shoham Business.
What Does The Institutional Ownership Tell Us About E.N. Shoham Business?
Many institutions measure their performance against an index that approximates the local market. So they usually pay more attention to companies that are included in major indices.
E.N. Shoham Business 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. 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 E.N. Shoham Business' earnings history below. Of course, the future is what really matters.
E.N. Shoham Business is not owned by hedge funds. With a 34% stake, CEO Eli Nidam is the largest shareholder. Yitzhak Snyder is the second largest shareholder owning 11% of common stock, and More Mutual Funds Management (2013) Ltd. holds about 4.3% of the company stock.
Our research also brought to light the fact that roughly 51% of the company is controlled by the top 4 shareholders suggesting that these owners wield significant influence on the business.
While studying institutional ownership for a company can add value to your research, it is also a good practice to research analyst recommendations to get a deeper understand of a stock's expected performance. 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 E.N. Shoham Business
The definition of an insider can differ slightly between different countries, but members of the board of directors always count. 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.
Our most recent data indicates that insiders own a reasonable proportion of E.N. Shoham Business Ltd. It has a market capitalization of just ₪347m, and insiders have ₪156m worth of shares in their own names. I would say this shows alignment with shareholders, but it is worth noting that the company is still quite small; some insiders may have founded the business. You can click here to see if those insiders have been buying or selling.
General Public Ownership
With a 43% ownership, the general public have some degree of sway over E.N. Shoham Business. This size of ownership, while considerable, may not be enough to change company policy if the decision is not in sync with other large shareholders.
It's always worth thinking about the different groups who own shares in a company. But to understand E.N. Shoham Business better, we need to consider many other factors. For example, we've discovered 3 warning signs for E.N. Shoham Business (1 doesn't sit too well with us!) that you should be aware of before investing here.
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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