Harel (HARL) AI Stock Analysis

• Market Cap: ₪38.26B
• Dividend Yield: 2.21%
• Average Volume (3M): 491.74K
• Price to Earnings (P/E): 15.9
• Beta (1Y): 1.68
• Revenue Growth: 5.84%
• EPS Growth: 138.80%
• Country: IL
• Employees: 5,158
• Sector: Financial
• Sector Strength: 70
• Industry: Insurance - Diversified
• EPS (TTM): 408.00
• Shares Outstanding: 205,799,940
• 10 Day Avg. Volume: 470,172
• 30 Day Avg. Volume: 491,739
• PEG Ratio: 0.11
• Price to Book (P/B): 1.14
• Price to Sales (P/S): 0.38
• P/FCF Ratio: -2.96
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0
• EPS Forecast (FY): 12.93
• Revenue Forecast (FY): ₪14.98B

• Rating: 76 Outperform
• Price Target: 17,809.00 ▲(10.07% Upside)
• Action: Reiterated Date: 12/11/25
• Date: Action: Reiterated 12/11/25

Harel's stock is rated positively due to strong financial performance and bullish technical indicators. The valuation is reasonable, but high leverage and cash flow volatility are risks to monitor.

Positive Factors

Diversified Revenue Streams

Harel earns premiums, investment income and management fees across insurance, pension and asset management, supported by strategic partnerships and a broad distribution network. This multi‑stream model provides durable cash flow diversification and reduces reliance on any single product or cycle, supporting resilience across insurance and asset management cycles over months.

Strong Profitability and Growth

Recent TTM metrics show very high gross margin, improving net margin and double‑digit revenue growth, reflecting efficient cost management and demand for core products. Sustained margin expansion and revenue momentum indicate structural competitive strength in underwriting and fee businesses, enabling reinvestment in distribution and product development over the medium term.

Improving Free Cash Flow Generation

Positive FCF growth and a healthy FCF-to-net-income ratio show the business is converting earnings into cash at a reasonable rate, improving funding capacity for dividends, capital needs and reserves. Robust free cash flow growth suggests durable internal financing ability that supports strategic initiatives without immediate reliance on external financing.

Negative Factors

High Financial Leverage

A debt-to-equity ratio near 1.8 and a relatively low equity ratio indicate significant leverage. Elevated debt increases interest and refinancing risk, reduces flexibility to pursue opportunistic investments, and heightens sensitivity to rate moves or underwriting shocks, which can constrain capital allocation and long‑term strategic optionality.

Weak Cash Conversion Consistency

An operating cash flow to net income ratio of zero and historical cash flow volatility point to inconsistent conversion of accounting profits to cash. This undermines the reliability of earnings to fund debt service, reserves or dividends and raises forecasting risk for investors and management planning over the coming quarters.

Historical Revenue Downturn Risk

Although recent revenue growth is strong, a reported revenue decline in 2022 highlights exposure to cyclical or structural headwinds that can recur. Past downturns suggest sensitivity to market, regulatory or underwriting conditions, which could periodically pressure margins and undermine medium‑term earnings visibility if not mitigated.

Harel Business Overview & Revenue Model

Company Description

Harel Insurance Investments & Financial Services Ltd offers insurance and financial services in Israel, the United States, and Western Europe. The company operates through five segments: Life Assurance and Long-Term Savings, Health Insurance, Non-life insurance, Insurance Companies Overseas, and Capital Market and Financial Services. It offers various classes of life insurance products, which provide coverage for risks, such as death, disability, work disability, and critical illness; and long-term saving products, as well as manages pension and provident funds. The company also provides health insurance that provides coverage for illness and hospitalization, and personal accident; travel insurance, insurance for foreign workers, and insurance for tourists; and dental insurance for conservative, periodontal, orthodontic, and oral rehabilitation treatments. In addition, it offers motor property insurance; professional liability insurance for investment consultants, portfolio managers, attorneys, engineers, architects, and accountants; insurance for clinical trials; directors and officers liability insurance; liability insurance for defective products; cyber insurance; third-party liability insurance; employers' liability insurance; and credit insurance for mortgages. Further, it provides fire and theft, homeowners, terrorism, cash in transit, goods in transit, electronic equipment, agricultural, mechanical engineering equipment, mechanical failure, and homebuyers insurance products as well as insurance for building work and various projects by contractors. Additionally, it manages mutual funds and investment portfolios; and offers certificates of deposit and private equity funds. The company was founded in 1933 and is based in Ramat Gan, Israel.

How the Company Makes Money

Harel generates revenue through multiple streams, primarily from premiums collected on insurance policies, investment income from its asset management operations, and fees from managing pension funds and mutual funds. The company earns significant income from life insurance products, which include both term and whole life policies. In addition, Harel's asset management division contributes to its revenues through management fees and performance fees from investment portfolios. Strategic partnerships with other financial institutions and a robust distribution network also enhance Harel's market reach, allowing it to attract more customers and increase its earnings. Overall, the combination of insurance underwriting, investment returns, and asset management services forms the core of Harel's revenue model.

Harel Financial Statement Overview

Summary

Harel's financial performance is strong, with high profitability and growth in the income statement. However, the high leverage on the balance sheet and cash flow volatility are concerns.

Income Statement

Harel's income statement shows strong performance with a high gross profit margin of 98.94% TTM, indicating efficient cost management. The net profit margin has improved to 6.78% TTM from 3.48% in the previous year, reflecting enhanced profitability. Revenue growth is robust at 11.8% TTM, showcasing a positive growth trajectory. EBIT and EBITDA margins have also improved, indicating operational efficiency. However, the company experienced a revenue decline in 2022, which could be a concern if repeated.

Balance Sheet

The balance sheet reveals a high debt-to-equity ratio of 1.78 TTM, suggesting significant leverage, which could pose financial risk. However, the return on equity is strong at 19.49% TTM, indicating effective use of equity to generate profits. The equity ratio is relatively low, reflecting a higher reliance on debt financing. Overall, while profitability is strong, the high leverage warrants caution.

Cash Flow

Cash flow analysis shows a positive free cash flow growth rate of 5.76% TTM, indicating improved cash generation. The free cash flow to net income ratio is healthy at 0.77 TTM, suggesting good cash conversion. However, the operating cash flow to net income ratio is zero, indicating potential issues in converting net income to cash. Past periods show volatility in cash flows, which could impact financial stability.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	28.08B	27.16B	24.86B	12.69B	27.49B	18.72B
Gross Profit	27.74B	24.73B	24.86B	10.70B	25.68B	16.91B
EBITDA	4.92B	2.45B	1.53B	2.06B	2.31B	1.50B
Net Income	2.40B	946.00M	485.00M	906.00M	1.21B	724.00M
Balance Sheet
Total Assets	167.75B	158.66B	144.81B	135.27B	137.67B	119.75B
Cash, Cash Equivalents and Short-Term Investments	33.09B	25.53B	26.50B	24.89B	26.25B	21.78B
Total Debt	22.66B	18.50B	10.95B	7.28B	7.14B	6.03B
Total Liabilities	156.21B	149.46B	135.85B	126.88B	128.78B	111.99B
Stockholders Equity	11.53B	9.12B	8.89B	8.34B	8.86B	7.74B
Cash Flow
Free Cash Flow	1.61B	-3.52B	3.02B	1.60B	1.13B	1.07B
Operating Cash Flow	2.08B	-3.06B	3.47B	1.98B	1.49B	1.41B
Investing Cash Flow	-1.03B	-1.02B	-511.00M	-371.00M	-632.00M	-203.00M
Financing Cash Flow	1.99B	1.45B	1.01B	-1.01B	581.00M	35.00M

Harel Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 16180.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For IL:HARL, the sentiment is Positive. The current price of 16180 is below the 20-day moving average (MA) of 16534.00, above the 50-day MA of 14689.40, and above the 200-day MA of 11382.89, indicating a bullish trend. The MACD of 779.97 indicates Negative momentum. The RSI at 72.19 is Negative, neither overbought nor oversold. The STOCH value of 77.02 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for IL:HARL.

Harel Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
PHOE	79 Outperform	₪44.79B	9.63	―	4.19%	12.22%	71.58%
HARL	76 Outperform	₪38.26B	15.95	23.23%	2.21%	5.84%	138.80%
MMHD	71 Outperform	₪32.10B	8.61	―	2.61%	23.28%	124.99%
MGDL	70 Outperform	₪20.18B	5.63	―	0.30%	6.00%	36.33%
CLIS	69 Neutral	₪21.48B	5.72	―	1.67%	-27.87%	229.49%
Sector *	68 Neutral	$18.00B	11.42	9.92%	3.81%	9.73%	1.22%
IDIN	60 Neutral	₪3.51B	9.13	―	5.98%	19.48%	53.61%