Stock Analysis

What Is The Ownership Structure Like For Reit 1 Ltd (TLV:RIT1)?

TASE:RIT1
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The big shareholder groups in Reit 1 Ltd (TLV:RIT1) have power over the company. Insiders often own a large chunk of younger, smaller, companies while huge companies tend to have institutions as shareholders. Companies that have been privatized tend to have low insider ownership.

Reit 1 has a market capitalization of ₪2.7b, so we would expect some institutional investors to have noticed the stock. Our analysis of the ownership of the company, below, shows that institutional investors have bought into the company. Let's delve deeper into each type of owner, to discover more about Reit 1.

See our latest analysis for Reit 1

ownership-breakdown
TASE:RIT1 Ownership Breakdown March 12th 2021

What Does The Institutional Ownership Tell Us About Reit 1?

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 Reit 1. 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 Reit 1, (below). Of course, keep in mind that there are other factors to consider, too.

earnings-and-revenue-growth
TASE:RIT1 Earnings and Revenue Growth March 12th 2021

Investors should note that institutions actually own more than half the company, so they can collectively wield significant power. Reit 1 is not owned by hedge funds. Altshuler Shaham Ltd. is currently the largest shareholder, with 15% of shares outstanding. In comparison, the second and third largest shareholders hold about 7.1% and 6.9% of the stock. Additionally, the company's CEO Shmuel Sayad directly holds 0.6% of the total shares outstanding.

We did some more digging and found that 8 of the top shareholders account for roughly 52% of the register, implying that along with larger shareholders, there are a few smaller shareholders, thereby balancing out each others interests somewhat.

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. We're not picking up on any analyst coverage of the stock at the moment, so the company is unlikely to be widely held.

Insider Ownership Of Reit 1

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.

I can report that insiders do own shares in Reit 1 Ltd. As individuals, the insiders collectively own ₪31m worth of the ₪2.7b company. It is good to see some investment by insiders, but it might be worth checking if those insiders have been buying.

General Public Ownership

With a 34% ownership, the general public have some degree of sway over Reit 1. 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:

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. For example, we've discovered 2 warning signs for Reit 1 (1 shouldn't be ignored!) that you should be aware of before investing here.

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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