Insiders with their considerable ownership were the key benefactors as Lapidoth Capital Ltd (TLV:LAPD) touches ₪4.8b market cap

Key Insights

• Lapidoth Capital's significant insider ownership suggests inherent interests in company's expansion
• Ya'akov Luxenburg owns 64% of the company
• Institutions own 18% of Lapidoth Capital

Every investor in Lapidoth Capital Ltd (TLV:LAPD) should be aware of the most powerful shareholder groups. And the group that holds the biggest piece of the pie are individual insiders with 64% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

As a result, insiders were the biggest beneficiaries of last week’s 5.6% gain.

In the chart below, we zoom in on the different ownership groups of Lapidoth Capital.

View our latest analysis for Lapidoth Capital

What Does The Institutional Ownership Tell Us About Lapidoth Capital?

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.

We can see that Lapidoth Capital does have institutional investors; and they hold a good portion of the company's stock. 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. 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 Lapidoth Capital's historic earnings and revenue below, but keep in mind there's always more to the story.

We note that hedge funds don't have a meaningful investment in Lapidoth Capital. Ya'akov Luxenburg is currently the company's largest shareholder with 64% of shares outstanding. With such a huge stake in the ownership, we infer that they have significant control of the future of the company. Altshuler Shaham Ltd. is the second largest shareholder owning 16% of common stock, and Phoenix Investments & Finances Ltd holds about 0.6% of the company stock.

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. 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 Lapidoth Capital

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.

Insider ownership is positive when it signals leadership are thinking like the true owners of the company. However, high insider ownership can also give immense power to a small group within the company. This can be negative in some circumstances.

Our information suggests that insiders own more than half of Lapidoth Capital Ltd. This gives them effective control of the company. Given it has a market cap of ₪4.8b, that means insiders have a whopping ₪3.1b 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

The general public, who are usually individual investors, hold a 18% stake in Lapidoth Capital. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.

Next Steps:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. Consider risks, for instance. Every company has them, and we've spotted 1 warning sign for Lapidoth Capital 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.