Insiders are the top stockholders in Future Care Trading Co. (TADAWUL:9544), and the recent 6.7% drop might have disappointed them

Key Insights

• Insiders appear to have a vested interest in Future Care Trading's growth, as seen by their sizeable ownership
• A total of 2 investors have a majority stake in the company with 66% ownership
• Ownership research, combined with past performance data can help provide a good understanding of opportunities in a stock

To get a sense of who is truly in control of Future Care Trading Co. (TADAWUL:9544), it is important to understand the ownership structure of the business. The group holding the most number of shares in the company, around 75% to be precise, is individual insiders. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

As a result, insiders as a group endured the highest losses after market cap fell by ر.س295m.

Let's take a closer look to see what the different types of shareholders can tell us about Future Care Trading.

View our latest analysis for Future Care Trading

What Does The Lack Of Institutional Ownership Tell Us About Future Care Trading?

We don't tend to see institutional investors holding stock of companies that are very risky, thinly traded, or very small. Though we do sometimes see large companies without institutions on the register, it's not particularly common.

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. It is also possible that fund managers don't own the stock because they aren't convinced it will perform well. Future Care Trading might not have the sort of past performance institutions are looking for, or perhaps they simply have not studied the business closely.

We note that hedge funds don't have a meaningful investment in Future Care Trading. Looking at our data, we can see that the largest shareholder is Fahd Abdulaziz Al Ghamedi with 33% of shares outstanding. For context, the second largest shareholder holds about 33% of the shares outstanding, followed by an ownership of 5.0% by the third-largest shareholder. Ahmed Hassan Naghi, who is the third-largest shareholder, also happens to hold the title of Member of the Board of Directors.

After doing some more digging, we found that the top 2 shareholders collectively control more than half of the company's shares, implying that they have considerable power to influence the company's decisions.

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

Insider Ownership Of Future Care Trading

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.

Our most recent data indicates that insiders own the majority of Future Care Trading Co.. This means they can collectively make decisions for the company. Insiders own ر.س3.1b worth of shares in the ر.س4.1b company. That's extraordinary! Most would argue this is a positive, showing strong alignment with shareholders. You can click here to see if they have been selling down their stake.

General Public Ownership

With a 25% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Future Care Trading. This size of ownership, while considerable, may not be enough to change company policy if the decision is not in sync with other large shareholders.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Future Care Trading better, we need to consider many other factors. Consider risks, for instance. Every company has them, and we've spotted 2 warning signs for Future Care Trading you should know about.

Of course this may not be the best stock to buy. So take a peek at this free 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.