- Significant control over Harel Insurance Investments & Financial Services by private companies implies that the general public has more power to influence management and governance-related decisions
- 52% of the business is held by the top 2 shareholders
- 19% of Harel Insurance Investments & Financial Services is held by Institutions
Every investor in Harel Insurance Investments & Financial Services Ltd (TLV:HARL) should be aware of the most powerful shareholder groups. We can see that private companies own the lion's share in the company with 47% 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 ₪6.4b market cap following a 3.2% gain in the stock.
Let's delve deeper into each type of owner of Harel Insurance Investments & Financial Services, beginning with the chart below.
What Does The Institutional Ownership Tell Us About Harel Insurance Investments & Financial Services?
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.
We can see that Harel Insurance Investments & Financial Services 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. 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 Harel Insurance Investments & Financial Services' earnings history below. Of course, the future is what really matters.
We note that hedge funds don't have a meaningful investment in Harel Insurance Investments & Financial Services. Our data shows that G.Y.N. Economic Advice & Management Ltd is the largest shareholder with 47% of shares outstanding. Meanwhile, the second and third largest shareholders, hold 4.4% and 2.3%, of the shares outstanding, respectively.
After doing some more digging, we found that the top 2 shareholders collectively control more than half of the company's shares, implying that they have considerable power to influence the company's decisions.
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. While there is some analyst coverage, the company is probably not widely covered. So it could gain more attention, down the track.
Insider Ownership Of Harel Insurance Investments & Financial Services
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 Harel Insurance Investments & Financial Services Ltd. We do note, however, it is possible insiders have an indirect interest through a private company or other corporate structure. It is a pretty big company, so it would be possible for board members to own a meaningful interest in the company, without owning much of a proportional interest. In this case, they own around ₪19m worth of shares (at current prices). It is always good to see at least some insider ownership, but it might be worth checking if those insiders have been selling.
General Public Ownership
With a 33% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Harel Insurance Investments & Financial Services. 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
Our data indicates that Private Companies hold 47%, of the company's shares. 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.
I find it very interesting to look at who exactly owns a company. But to truly gain insight, we need to consider other information, too. Case in point: We've spotted 3 warning signs for Harel Insurance Investments & Financial Services you should be aware of.
If you are like me, you may want to think about whether this company will grow or shrink. Luckily, you can check this free report showing analyst forecasts for its future.
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.