Institutions along with public companies who hold considerable shares inNeto Malinda Trading Ltd. (TLV:NTML) come under pressure; lose 11% of holdings value

Key Insights

• Significant control over Neto Malinda Trading by public companies implies that the general public has more power to influence management and governance-related decisions
• The top 2 shareholders own 57% of the company
• Institutions own 40% of Neto Malinda Trading

Every investor in Neto Malinda Trading Ltd. (TLV:NTML) should be aware of the most powerful shareholder groups. With 49% stake, public companies possess the maximum shares in the company. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

While the holdings of public companies took a hit after last week’s 11% price drop, institutions with their 40% holdings also suffered.

In the chart below, we zoom in on the different ownership groups of Neto Malinda Trading.

Check out our latest analysis for Neto Malinda Trading

What Does The Institutional Ownership Tell Us About Neto Malinda Trading?

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.

Neto Malinda Trading already has institutions on the share registry. Indeed, they own a respectable stake in the company. This implies the analysts working for those institutions have looked at the stock and they like it. But just like anyone else, they could be wrong. It is not uncommon to see a big share price drop if two large institutional investors try to sell out of a stock at the same time. So it is worth checking the past earnings trajectory of Neto Malinda Trading, (below). Of course, keep in mind that there are other factors to consider, too.

Neto Malinda Trading is not owned by hedge funds. Our data shows that Neto M.E Holdings Ltd is the largest shareholder with 49% of shares outstanding. In comparison, the second and third largest shareholders hold about 7.9% and 7.6% of the stock.

To make our study more interesting, we found that the top 2 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. 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 Neto Malinda Trading

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.

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.

Our data cannot confirm that board members are holding shares personally. Given we are not picking up on insider ownership, we may have missing data. Therefore, it would be interesting to assess the CEO compensation and tenure, here.

General Public Ownership

The general public, who are usually individual investors, hold a 11% stake in Neto Malinda Trading. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.

Public Company Ownership

We can see that public companies hold 49% of the Neto Malinda Trading shares on issue. 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. Consider for instance, the ever-present spectre of investment risk. We've identified 1 warning sign with Neto Malinda Trading , and understanding them should be part of your investment process.

If you would prefer check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, backed by strong financial data.

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.