Insiders with their considerable ownership were the key benefactors as Armah Sports Company (TADAWUL:9590) touches ر.س1.6b market cap

Key Insights

• Significant insider control over Armah Sports implies vested interests in company growth
• The top 4 shareholders own 52% of the company
• Past performance of a company along with ownership data serve to give a strong idea about prospects for a business

A look at the shareholders of Armah Sports Company (TADAWUL:9590) can tell us which group is most powerful. The group holding the most number of shares in the company, around 60% to be precise, is individual insiders. Put another way, the group faces the maximum upside potential (or downside risk).

As a result, insiders scored the highest last week as the company hit ر.س1.6b market cap following a 12% gain in the stock.

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

View our latest analysis for Armah Sports

What Does The Lack Of Institutional Ownership Tell Us About Armah Sports?

Institutional investors often avoid companies that are too small, too illiquid or too risky for their tastes. But it's unusual to see larger companies without any institutional investors.

There are many reasons why a company might not have any institutions on the share registry. It may be hard for institutions to buy large amounts of shares, if liquidity (the amount of shares traded each day) is low. If the company has not needed to raise capital, institutions might lack the opportunity to build a position. On the other hand, it's always possible that professional investors are avoiding a company because they don't think it's the best place for their money. Armah Sports might not have the sort of past performance institutions are looking for, or perhaps they simply have not studied the business closely.

Hedge funds don't have many shares in Armah Sports. Looking at our data, we can see that the largest shareholder is Jiad United for Real Estate Development Company with 23% of shares outstanding. Abdulmohsen Ali Alhagbani is the second largest shareholder owning 13% of common stock, and Nahla Alhagbani holds about 8.6% of the company stock. In addition, we found that Fahad Ali Alhagbani, the CEO has 4.4% of the shares allocated to their name.

To make our study more interesting, we found that the top 4 shareholders control more than half of the company which implies that this group has considerable sway over the company's decision-making.

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. 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 Armah Sports

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. 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 most recent data indicates that insiders own the majority of Armah Sports Company. This means they can collectively make decisions for the company. Given it has a market cap of ر.س1.6b, that means they have ر.س949m 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 17% stake in Armah Sports. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.

Private Company Ownership

We can see that Private Companies own 23%, of the shares on issue. It's hard to draw any conclusions from this fact alone, so its worth looking into who owns those private companies. Sometimes insiders or other related parties have an interest in shares in a public company through a separate private company.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Armah Sports better, we need to consider many other factors. Take risks for example - Armah Sports has 2 warning signs we think you should be aware of.

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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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.