Private companies in Cohen Development Gas & Oil Ltd. (TLV:CDEV) are its biggest bettors, and their bets paid off as stock gained 12% last week

Key Insights

• The considerable ownership by private companies in Cohen Development Gas & Oil indicates that they collectively have a greater say in management and business strategy
• 64% of the business is held by the top 3 shareholders
• 19% of Cohen Development Gas & Oil is held by Institutions

Every investor in Cohen Development Gas & Oil Ltd. (TLV:CDEV) should be aware of the most powerful shareholder groups. And the group that holds the biggest piece of the pie are private companies with 27% ownership. Put another way, the group faces the maximum upside potential (or downside risk).

As a result, private companies collectively scored the highest last week as the company hit ₪696m market cap following a 12% gain in the stock.

In the chart below, we zoom in on the different ownership groups of Cohen Development Gas & Oil.

See our latest analysis for Cohen Development Gas & Oil

What Does The Institutional Ownership Tell Us About Cohen Development Gas & Oil?

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.

Cohen Development Gas & Oil 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. 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 Cohen Development Gas & Oil's historic earnings and revenue below, but keep in mind there's always more to the story.

It would appear that 6.2% of Cohen Development Gas & Oil shares are controlled by hedge funds. That catches my attention because hedge funds sometimes try to influence management, or bring about changes that will create near term value for shareholders. Mizrahi Tefahot Bank Ltd. is currently the company's largest shareholder with 25% of shares outstanding. With 24% and 15% of the shares outstanding respectively, Yongil Ltd and Phoenix Excellence Pension and Provident Ltd. are the second and third largest shareholders.

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.

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. 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 Cohen Development Gas & Oil

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.

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 less than 1% of Cohen Development Gas & Oil Ltd.. However, it's possible that insiders might have an indirect interest through a more complex structure. It seems the board members have no more than ₪624k worth of shares in the ₪696m company. Many investors in smaller companies prefer to see the board more heavily invested. You can click here to see if those insiders have been buying or selling.

General Public Ownership

With a 23% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Cohen Development Gas & Oil. 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 27%, of the Cohen Development Gas & Oil stock. It's hard to draw any conclusions from this fact alone, so its worth looking into who owns those private companies. Sometimes insiders or other related parties have an interest in shares in a public company through a separate private company.

Public Company Ownership

It appears to us that public companies own 25% of Cohen Development Gas & Oil. We can't be certain but it is quite possible this is a strategic stake. The businesses may be similar, or work together.

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 Cohen Development Gas & Oil is showing 3 warning signs in our investment analysis , and 1 of those is significant...

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.