I.D.I. Insurance Company Ltd. (TLV:IDIN) surges 11%; public companies who own 49% shares profited along with institutions

Key Insights

• Significant control over I.D.I. Insurance by public companies implies that the general public has more power to influence management and governance-related decisions
• A total of 2 investors have a majority stake in the company with 53% ownership
• Institutional ownership in I.D.I. Insurance is 26%

If you want to know who really controls I.D.I. Insurance Company Ltd. (TLV:IDIN), then you'll have to look at the makeup of its share registry. And the group that holds the biggest piece of the pie are public companies with 49% ownership. Put another way, the group faces the maximum upside potential (or downside risk).

While public companies were the group that reaped the most benefits after last week’s 11% price gain, institutions also received a 26% cut.

In the chart below, we zoom in on the different ownership groups of I.D.I. Insurance.

View our latest analysis for I.D.I. Insurance

What Does The Institutional Ownership Tell Us About I.D.I. Insurance?

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.

I.D.I. Insurance already has institutions on the share registry. Indeed, they own a respectable stake in the company. 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. 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 I.D.I. Insurance, (below). Of course, keep in mind that there are other factors to consider, too.

I.D.I. Insurance is not owned by hedge funds. Our data shows that Zur Shamir Holdings Ltd is the largest shareholder with 49% of shares outstanding. In comparison, the second and third largest shareholders hold about 4.1% and 3.9% of the stock.

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 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 I.D.I. Insurance

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. 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.

Our data suggests that insiders own under 1% of I.D.I. Insurance Company Ltd. in their own names. It seems the board members have no more than ₪7.2m worth of shares in the ₪1.2b 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

The general public, who are usually individual investors, hold a 24% stake in I.D.I. Insurance. 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.

Public Company Ownership

It appears to us that public companies own 49% of I.D.I. Insurance. 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. Take risks for example - I.D.I. Insurance has 3 warning signs (and 1 which makes us a bit uncomfortable) we think you should know about.

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.