Equital Ltd.'s (TLV:EQTL) market cap surged ₪272m last week, individual investors who have a lot riding on the company were rewarded

Key Insights

• Significant control over Equital by individual investors implies that the general public has more power to influence management and governance-related decisions
• 51% of the business is held by the top 4 shareholders
• 28% of Equital is held by Institutions

To get a sense of who is truly in control of Equital Ltd. (TLV:EQTL), it is important to understand the ownership structure of the business. We can see that individual investors own the lion's share in the company with 35% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

Clearly, individual investors benefitted the most after the company's market cap rose by ₪272m last week.

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

View our latest analysis for Equital

What Does The Institutional Ownership Tell Us About Equital?

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.

Equital 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 Equital's historic earnings and revenue below, but keep in mind there's always more to the story.

Hedge funds don't have many shares in Equital. The company's largest shareholder is United Kingsway Ltd., with ownership of 31%. The second and third largest shareholders are Meitav Investment House Ltd and Menora Mivtachim Pensions & Gemel Ltd., with an equal amount of shares to their name at 7.0%.

To make our study more interesting, we found that the top 4 shareholders control more than half of the company which implies that this group has considerable sway over the company's decision-making.

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 Equital

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. 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.

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.

We can see that insiders own shares in Equital Ltd.. This is a big company, so it is good to see this level of alignment. Insiders own ₪253m worth of shares (at current prices). It is good to see this level of investment by insiders. You can check here to see if those insiders have been buying recently.

General Public Ownership

With a 35% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Equital. 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.

Private Company Ownership

It seems that Private Companies own 31%, of the Equital 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:

It's always worth thinking about the different groups who own shares in a company. But to understand Equital better, we need to consider many other factors. Be aware that Equital is showing 2 warning signs in our investment analysis , and 1 of those is potentially serious...

Of course this may not be the best stock to buy. So take a peek at this free 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.