The recent pullback must have dismayed Summit Real Estate Holdings Ltd (TLV:SMT) insiders who own 52% of the company

Key Insights

• Significant insider control over Summit Real Estate Holdings implies vested interests in company growth
• 51% of the company is held by a single shareholder (Zohar Levy)
• 37% of Summit Real Estate Holdings is held by Institutions

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A look at the shareholders of Summit Real Estate Holdings Ltd (TLV:SMT) can tell us which group is most powerful. With 52% stake, individual insiders 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).

And following last week's 7.4% decline in share price, insiders suffered the most losses.

In the chart below, we zoom in on the different ownership groups of Summit Real Estate Holdings.

Check out our latest analysis for Summit Real Estate Holdings

What Does The Institutional Ownership Tell Us About Summit Real Estate Holdings?

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.

As you can see, institutional investors have a fair amount of stake in Summit Real Estate Holdings. This can indicate that the company has a certain degree of credibility in the investment community. However, it is best to be wary of relying on the supposed validation that comes with institutional investors. They too, get it wrong sometimes. 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 Summit Real Estate Holdings' historic earnings and revenue below, but keep in mind there's always more to the story.

Hedge funds don't have many shares in Summit Real Estate Holdings. Zohar Levy is currently the largest shareholder, with 51% of shares outstanding. This implies that they have majority interest control of the future of the company. With 11% and 6.9% of the shares outstanding respectively, Menora Mivtachim Provident Funds and Phoenix Excellence Pension and Provident Ltd. are the second and third largest shareholders.

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 Summit Real Estate Holdings

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. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.

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 Summit Real Estate Holdings Ltd. This gives them effective control of the company. Given it has a market cap of ₪3.7b, that means insiders have a whopping ₪1.9b 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 11% stake in Summit Real Estate Holdings. 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:

It's always worth thinking about the different groups who own shares in a company. But to understand Summit Real Estate Holdings better, we need to consider many other factors. Like risks, for instance. Every company has them, and we've spotted 3 warning signs for Summit Real Estate Holdings (of which 2 are a bit unpleasant!) 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.