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Formula Systems (1985) Ltd. (IL:FORTY)
:FORTY
Israel Market
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Formula (FORTY) AI Stock Analysis

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IL:FORTY

Formula

(FORTY)

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Outperform 76 (OpenAI - 4o)
Rating:76Outperform
Price Target:
48,612.00
▲(5.13% Upside)
The overall stock score of 76.1 reflects Formula's strong financial performance, characterized by consistent revenue growth and effective cash flow management. Technical analysis supports a positive trend, although valuation metrics suggest the stock may be slightly overvalued. The absence of earnings call data and corporate events did not impact the score.

Formula (FORTY) vs. iShares MSCI Israel ETF (EIS)

Formula Business Overview & Revenue Model

Company DescriptionFormula Systems (1985) Ltd., through its subsidiaries, provides proprietary and non-proprietary software solutions, IT professional services, software product marketing and support, and computer infrastructure and integration solutions worldwide. The company offers computer and telecommunication infrastructure solutions; computer solutions to computer and communications infrastructures; cloud computing solutions; and database and big data services. It also provides customer relations management, computer systems management infrastructures, web world content management, database and data warehouse mining, application integration, database and system, data management, and software development tools; and professional training courses and advanced professional studies. In addition, it markets and sells computers and peripheral equipment to business customers; offers property and casualty insurance platforms, such as Sapiens, Sapiens CoreSuite, Sapiens IDITSuite, Sapiens PolicyPro, Sapiens BillingPro, Sapiens ClaimsPro, e-Tica, and Tia Enterprise; life, pension, and annuities platforms, including Sapiens CoreSuite, Sapiens UnderwritingPro, Sapiens ApplicationPro, Sapiens IllustrationPro, and Sapiens ConsolidationMaster; reinsurance software solutions comprising Sapiens ReinsuranceMaster, Sapiens ReinsurancePro, and Sapiens Reinsurance GO; and Sapiens platform for workers' compensation solutions. Further, the company provides financial and compliance solutions that include Sapiens FinancialPro, Sapiens Financial GO, and Sapiens StatementPro; Sapiens DECISION, a decision management platform; and technology-based solutions. Additionally, it offers application development and business process integration platforms; vertical software solutions; strategic consulting and outsourcing services; and professional services in various areas, as well as develops on-premise payroll software. Formula Systems (1985) Ltd. was incorporated in 1985 and is headquartered in Or Yehuda, Israel.
How the Company Makes MoneyFormula generates revenue through multiple key streams, primarily by selling its proprietary EV charging stations and related hardware to businesses and consumers. The company also earns income from subscription-based software services that provide real-time analytics and energy management solutions to fleet operators and charging network providers. Additionally, Formula has established strategic partnerships with automotive manufacturers and energy companies, which not only enhance its market reach but also create collaborative opportunities for joint product development and co-marketing efforts. These partnerships enable Formula to tap into a broader customer base while benefiting from shared resources and expertise, further solidifying its revenue-generating capabilities.

Formula Financial Statement Overview

Summary
Formula has demonstrated robust financial health with consistent revenue growth, stable margins, and improved leverage. The company has effectively managed its cash flows, supporting its operational and strategic initiatives. While ROE has fluctuated, the overall financial trajectory remains positive, positioning the company well within the Information Technology Services industry.
Income Statement
The company has demonstrated consistent revenue growth, with a notable increase from $1.93 billion in 2020 to $2.76 billion in 2024. Gross profit margin has remained stable, averaging around 24.8% over the years. Net profit margin improved slightly from 3.9% in 2020 to 2.9% in 2024, indicating controlled costs and efficient operations. EBIT and EBITDA margins have shown positive trends, reflecting strong operational performance.
Balance Sheet
The balance sheet shows a stable financial position with a debt-to-equity ratio decreasing from 1.43 in 2020 to 0.95 in 2024, indicating improved leverage management. Return on equity (ROE) has been volatile, peaking at 36.5% in 2022 but declining to 11.7% in 2024. The equity ratio has improved, suggesting a stronger equity base relative to total assets.
Cash Flow
The company has shown strong free cash flow growth, with free cash flow increasing from $159.5 million in 2019 to $295.5 million in 2024. Operating cash flow to net income ratio has been consistently above 1, indicating healthy cash generation relative to net income. Free cash flow to net income ratio also reflects efficient cash conversion.
BreakdownTTMDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue2.89B2.76B2.62B2.57B2.41B1.93B
Gross Profit720.23M684.68M643.71M622.47M563.86M447.43M
EBITDA287.11M391.80M362.53M390.45M324.26M258.04M
Net Income78.04M79.67M64.01M201.47M141.40M112.49M
Balance Sheet
Total Assets3.20B3.01B2.81B2.79B2.75B2.52B
Cash, Cash Equivalents and Short-Term Investments406.17M563.20M528.17M569.06M512.46M533.15M
Total Debt683.87M644.21M669.99M772.67M712.91M668.54M
Total Liabilities1.73B1.63B1.50B1.62B1.57B1.41B
Stockholders Equity722.92M679.34M625.76M551.87M540.96M502.73M
Cash Flow
Free Cash Flow0.00295.49M262.97M199.82M177.42M258.13M
Operating Cash Flow0.00324.45M294.97M239.14M208.48M286.94M
Investing Cash Flow0.00-78.18M-139.24M-74.30M-110.19M-177.03M
Financing Cash Flow0.00-184.96M-243.18M-70.98M-114.13M9.73M

Formula Technical Analysis

Technical Analysis Sentiment
Positive
Last Price46240.00
Price Trends
50DMA
44019.74
Positive
100DMA
42133.25
Positive
200DMA
37327.34
Positive
Market Momentum
MACD
701.25
Positive
RSI
51.58
Neutral
STOCH
17.57
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For IL:FORTY, the sentiment is Positive. The current price of 46240 is above the 20-day moving average (MA) of 46182.53, above the 50-day MA of 44019.74, and above the 200-day MA of 37327.34, indicating a bullish trend. The MACD of 701.25 indicates Positive momentum. The RSI at 51.58 is Neutral, neither overbought nor oversold. The STOCH value of 17.57 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for IL:FORTY.

Formula Risk Analysis

Formula disclosed 52 risk factors in its most recent earnings report. Formula reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks

Formula Peers Comparison

Overall Rating
UnderperformOutperform
Sector (61)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
76
Outperform
7.09B24.793.24%6.03%13.51%
76
Outperform
7.51B26.532.81%6.43%14.81%
72
Outperform
3.07B30.7312.51%45.01%
67
Neutral
6.04B23.952.75%11.47%26.50%
61
Neutral
$37.18B12.37-10.20%1.83%8.50%-7.62%
* Technology Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
IL:FORTY
Formula
46,240.00
15,488.79
50.37%
IL:CMDR
Computer Direct
47,240.00
20,495.92
76.64%
IL:MLTM
Malam Team
14,000.00
7,689.00
121.83%
IL:ONE
One Technologi
8,557.00
3,490.73
68.90%
IL:MTRX
Matrix
12,030.00
5,027.58
71.80%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.Date of analysis: Oct 23, 2025