Recent 13% pullback would hurt Libra Insurance Company Ltd (TLV:LBRA) insiders

By
Simply Wall St
Published
January 24, 2022
TASE:LBRA
Source: Shutterstock

A look at the shareholders of Libra Insurance Company Ltd (TLV:LBRA) can tell us which group is most powerful. With 52% stake, individual insiders possess the maximum shares in the company. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

As market cap fell to ₪369m last week, insiders would have faced the highest losses than any other shareholder groups of the company.

Let's delve deeper into each type of owner of Libra Insurance, beginning with the chart below.

Check out our latest analysis for Libra Insurance

ownership-breakdown
TASE:LBRA Ownership Breakdown January 24th 2022

What Does The Institutional Ownership Tell Us About Libra Insurance?

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.

Institutions have a very small stake in Libra Insurance. That indicates that the company is on the radar of some funds, but it isn't particularly popular with professional investors at the moment. If the company is growing earnings, that may indicate that it is just beginning to catch the attention of these deep-pocketed investors. When multiple institutional investors want to buy shares, we often see a rising share price. The past revenue trajectory (shown below) can be an indication of future growth, but there are no guarantees.

earnings-and-revenue-growth
TASE:LBRA Earnings and Revenue Growth January 24th 2022

We note that hedge funds don't have a meaningful investment in Libra Insurance. Eti Elishkov is currently the company's largest shareholder with 44% of shares outstanding. Boaz Talam is the second largest shareholder owning 4.4% of common stock, and Cogito Capital Partners holds about 1.5% of the company stock.

To make our study more interesting, we found that the top 3 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. Our information suggests that there isn't any analyst coverage of the stock, so it is probably little known.

Insider Ownership Of Libra Insurance

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.

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.

It seems that insiders own more than half the Libra Insurance Company Ltd stock. This gives them a lot of power. Given it has a market cap of ₪369m, that means they have ₪191m worth of shares. It is good to see this level of investment. You can check here to see if those insiders have been buying recently.

General Public Ownership

The general public, who are usually individual investors, hold a 46% stake in Libra Insurance. While this size of ownership may not be enough to sway a policy decision in their favour, they can still make a collective impact on company policies.

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 Libra Insurance , and understanding them should be part of your investment process.

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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