Saudi Company for Hardware SACO's (TADAWUL:4008) market cap surged ر.س140m last week, individual investors who have a lot riding on the company were rewarded

Key Insights

• Significant control over Saudi Company for Hardware SACO by individual investors implies that the general public has more power to influence management and governance-related decisions
• The top 4 shareholders own 53% of the company
• Insiders own 28% of Saudi Company for Hardware SACO

A look at the shareholders of Saudi Company for Hardware SACO (TADAWUL:4008) can tell us which group is most powerful. With 41% stake, individual investors possess the maximum shares in the company. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

As a result, individual investors were the biggest beneficiaries of last week’s 11% gain.

In the chart below, we zoom in on the different ownership groups of Saudi Company for Hardware SACO.

View our latest analysis for Saudi Company for Hardware SACO

What Does The Lack Of Institutional Ownership Tell Us About Saudi Company for Hardware SACO?

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. Institutional investors may not find the historic growth of the business impressive, or there might be other factors at play. You can see the past revenue performance of Saudi Company for Hardware SACO, for yourself, below.

Saudi Company for Hardware SACO is not owned by hedge funds. Abdurrahman Sharbatly is currently the company's largest shareholder with 18% of shares outstanding. Abrar International Holding Co. is the second largest shareholder owning 18% of common stock, and Alhumaidi Contracting Co holds about 12% of the company stock.

On looking further, we found that 53% of the shares are owned by the top 4 shareholders. In other words, these shareholders have a meaningful say in the decisions of the company.

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. There are a reasonable number of analysts covering the stock, so it might be useful to find out their aggregate view on the future.

Insider Ownership Of Saudi Company for Hardware SACO

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. 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.

I generally consider insider ownership to be a good thing. However, on some occasions it makes it more difficult for other shareholders to hold the board accountable for decisions.

Our most recent data indicates that insiders own a reasonable proportion of Saudi Company for Hardware SACO. Insiders have a ر.س401m stake in this ر.س1.4b business. We would say this shows alignment with shareholders, but it is worth noting that the company is still quite small; some insiders may have founded the business. You can click here to see if those insiders have been buying or selling.

General Public Ownership

With a 41% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Saudi Company for Hardware SACO. 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

It seems that Private Companies own 30%, of the Saudi Company for Hardware SACO stock. 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 Saudi Company for Hardware SACO better, we need to consider many other factors.

I always like to check for a history of revenue growth. You can too, by accessing this free chart of historic revenue and earnings in this detailed graph.

If you are like me, you may want to think about whether this company will grow or shrink. Luckily, you can check this free report showing analyst forecasts for its future.

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.