Electra Real Estate Ltd.'s (TLV:ELCRE) market cap dropped ₪199m last week; individual investors who hold 60% were hit as were institutions

By
Simply Wall St
Published
April 11, 2022
TASE:ELCRE
Source: Shutterstock

If you want to know who really controls Electra Real Estate Ltd. (TLV:ELCRE), 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 private companies with 60% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

While institutions who own 26% came under pressure after market cap dropped to ₪3.2b last week,private companies took the most losses.

Let's take a closer look to see what the different types of shareholders can tell us about Electra Real Estate.

See our latest analysis for Electra Real Estate

ownership-breakdown
TASE:ELCRE Ownership Breakdown April 11th 2022

What Does The Institutional Ownership Tell Us About Electra Real Estate?

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 Electra Real Estate does have institutional investors; and they hold a good portion of the company's stock. 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 Electra Real Estate, (below). Of course, keep in mind that there are other factors to consider, too.

earnings-and-revenue-growth
TASE:ELCRE Earnings and Revenue Growth April 11th 2022

Electra Real Estate is not owned by hedge funds. Our data shows that G. Salkind Ltd. is the largest shareholder with 60% of shares outstanding. This essentially means that they have extensive influence, if not outright control, over the future of the corporation. For context, the second largest shareholder holds about 8.6% of the shares outstanding, followed by an ownership of 8.1% by the third-largest shareholder.

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. Our information suggests that there isn't any analyst coverage of the stock, so it is probably little known.

Insider Ownership Of Electra Real Estate

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. 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 most recent data indicates that insiders own less than 1% of Electra Real Estate Ltd.. However, it's possible that insiders might have an indirect interest through a more complex structure. Keep in mind that it's a big company, and the insiders own ₪1.9m worth of shares. The absolute value might be more important than the proportional share. Arguably, recent buying and selling is just as important to consider. You can click here to see if insiders have been buying or selling.

General Public Ownership

The general public, who are usually individual investors, hold a 15% stake in Electra Real Estate. 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.

Private Company Ownership

We can see that Private Companies own 60%, of the shares on issue. Private companies may be related parties. Sometimes insiders have an interest in a public company through a holding in a private company, rather than in their own capacity as an individual. While it's hard to draw any broad stroke conclusions, it is worth noting as an area for further research.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Electra Real Estate better, we need to consider many other factors. Take risks for example - Electra Real Estate has 4 warning signs (and 2 which are a bit unpleasant) we think you should know about.

Of course this may not be the best stock to buy. Therefore, you may wish to see our free collection of interesting prospects boasting favorable financials.

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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