Is Hagag Group Real Estate Entrepreneurship Ltd's (TLV:HGG) Shareholder Ownership Skewed Towards Insiders?

If you want to know who really controls Hagag Group Real Estate Entrepreneurship Ltd (TLV:HGG), then you'll have to look at the makeup of its share registry. Generally speaking, as a company grows, institutions will increase their ownership. Conversely, insiders often decrease their ownership over time. I quite like to see at least a little bit of insider ownership. As Charlie Munger said 'Show me the incentive and I will show you the outcome.

Hagag Group Real Estate Entrepreneurship is not a large company by global standards. It has a market capitalization of ₪657m, which means it wouldn't have the attention of many institutional investors. Our analysis of the ownership of the company, below, shows that institutional investors have bought into the company. Let's take a closer look to see what the different types of shareholders can tell us about Hagag Group Real Estate Entrepreneurship.

View our latest analysis for Hagag Group Real Estate Entrepreneurship

What Does The Institutional Ownership Tell Us About Hagag Group Real Estate Entrepreneurship?

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.

Hagag Group Real Estate Entrepreneurship already has institutions on the share registry. Indeed, they own a respectable stake in the company. 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 Hagag Group Real Estate Entrepreneurship's historic earnings and revenue below, but keep in mind there's always more to the story.

We note that hedge funds don't have a meaningful investment in Hagag Group Real Estate Entrepreneurship. Our data shows that Yitzhak Hagag is the largest shareholder with 38% of shares outstanding. Meanwhile, the second and third largest shareholders, hold 30% and 7.7%, of the shares outstanding, respectively. Yehuda Hagag, who is the second-largest shareholder, also happens to hold the title of Chief Executive Officer.

To make our study more interesting, we found that the top 2 shareholders have a majority ownership in the company, meaning that they are powerful enough to influence the decisions of the company.

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. As far I can tell there isn't analyst coverage of the company, so it is probably flying under the radar.

Insider Ownership Of Hagag Group Real Estate Entrepreneurship

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. 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.

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.

It seems that insiders own more than half the Hagag Group Real Estate Entrepreneurship Ltd stock. This gives them a lot of power. That means they own ₪448m worth of shares in the ₪657m company. That's quite meaningful. Most would argue this is a positive, showing strong alignment with shareholders. You can click here to see if those insiders have been buying or selling.

General Public Ownership

With a 12% ownership, the general public have some degree of sway over Hagag Group Real Estate Entrepreneurship. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.

Next Steps:

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. To that end, you should learn about the 4 warning signs we've spotted with Hagag Group Real Estate Entrepreneurship (including 1 which is is significant) .

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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