Hilan (HLAN) AI Stock Analysis

• Market Cap: ₪4.73B
• Dividend Yield: 1.88%
• Average Volume (3M): 32.91K
• Price to Earnings (P/E): 18.1
• Beta (1Y): 1.07
• Revenue Growth: 7.39%
• EPS Growth: 10.64%
• Country: IL
• Employees: 5,517
• Sector: Technology
• Sector Strength: 88
• Industry: Information Technology Services
• EPS (TTM): 344.70
• Shares Outstanding: 22,962,677
• 10 Day Avg. Volume: 32,343
• 30 Day Avg. Volume: 32,906
• PEG Ratio: 3.89
• Price to Book (P/B): 4.79
• Price to Sales (P/S): 2.01
• P/FCF Ratio: 16.73
• 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): N/A
• Revenue Forecast (FY): N/A

• Rating: 68 Neutral
• Price Target: 22,955.00 ▼(-14.03% Downside)
• Action: Downgraded Date: 03/19/26
• Date: Action: Downgraded 03/19/26

Score is supported primarily by strong financial performance (growth, profitability, ROE, and conservative leverage). This is partially offset by weak technicals (below key moving averages with negative MACD). Valuation is moderately supportive with a reasonable P/E and a ~2.4% dividend yield.

Positive Factors

Sustained revenue scaling (2020–2025)

Material and multi-year revenue scaling demonstrates durable demand for Hilan's payroll, software and services mix. Coupled with recurring fees for payroll and subscriptions, this supports predictable top-line growth, improved operating leverage potential, and capacity to invest in product and market expansion over the medium term.

High returns on shareholder capital (~21%)

Consistently strong ROE near 21% signals efficient capital deployment and enduring profitability in core HCM services. High ROE supports sustained shareholder value creation, indicating the business model and pricing/operational structure deliver above-average returns relative to invested equity over multiple years.

Conservative, improving leverage and balance sheet

Declining debt-to-equity and meaningful equity growth enhance financial resilience and flexibility. A stronger balance sheet lowers interest and refinancing risk, increases capacity for selective M&A or product investment, and provides a structural cushion through economic cycles, supporting long-term operational stability.

Negative Factors

Free cash flow declined in 2025

A drop in free cash flow in 2025, despite earnings quality, suggests higher reinvestment needs or working-capital pressure. Persistent FCF weakness would constrain organic investment, dividend/stewardship flexibility, and reduce margin of safety for strategic initiatives, making cash conversion volatility a material execution risk.

Gross margin hasn't expanded

A lack of gross-margin improvement implies limited pricing power or rising input costs in core payroll and software services. Without margin expansion, higher revenues may not translate into proportionate profit growth, constraining net-margin upside and limiting the sustainability of elevated ROE over the medium term.

Asset growth not boosting returns

Rising asset base without higher returns raises capital-allocation concerns: new investments or acquisitions have yet to be accretive. If incremental assets do not generate higher margins or revenue productivity, capital efficiency and ROE could erode, pressuring long-term shareholder returns until projects mature.

Hilan Business Overview & Revenue Model

Company Description

Hilan Ltd., a software as a service (SaaS) provider, develops solutions for management of enterprise human capital in Israel. It provides solutions for payroll, HR, time and attendance, pension, analytics, and BPO; and managing the employee lifecycle from recruitment to retirement. The company also offers information technology (IT) infrastructure, security, and data management; and IT solutions, including big data, data storage, backup and virtualization, cloud SaaS, data, and cyber security. It serves customers in the industry, high-tech, finance, academic, communication, health care, municipal, transportation, retail, government, education, social care, association, and hotel sectors. The company is headquartered in Tel Aviv-Yafo, Israel.

How the Company Makes Money

Hilan makes money primarily by providing outsourced payroll and related human-capital administration services, and by selling and supporting software used to manage workforce processes. Key revenue streams include (1) recurring fees for payroll processing and ongoing managed services (e.g., payroll calculations, reporting, regulatory-related processing, and administration workflows), (2) software revenues from licensing/subscription and implementation of HR/time-attendance and related enterprise applications, and (3) professional services revenues from consulting projects (such as HR/organizational consulting and implementation/support services). Additional earnings may come from ongoing maintenance/support arrangements tied to its software and managed-service engagements. Specific material partnerships or customer concentration details are null.

Hilan Financial Statement Overview

Summary

Strong overall fundamentals: sustained revenue expansion, steady high-single-digit net margins, strong ROE (~21%) and a conservatively leveraged, improving balance sheet. The main drawback is weaker cash-flow momentum, with free cash flow declining in 2025 and cash conversion showing some volatility.

Income Statement

Revenue has scaled materially over 2020–2025, with strong growth in 2022–2023 and a solid step-up again in 2025. Profitability is consistently healthy for the sector, with gross margin holding around the low‑20% range and operating profitability improving into 2025 (EBIT and EBITDA margins up versus 2023–2024). Net margin remains steady in the high single-digits, though gross margin has not expanded and is slightly below 2020–2022 levels, suggesting limited pricing/mix uplift.

Balance Sheet

Leverage looks conservative and improving, with debt-to-equity declining from higher levels in 2020 to a low level in 2025. Equity has grown meaningfully over time, supporting balance sheet resilience. Returns on shareholder capital are consistently strong (roughly ~21% in recent years), but total assets rose notably in 2024–2025 while returns stayed about flat, implying incremental investment is not yet driving higher returns.

Cash Flow

Cash generation is solid, with free cash flow closely tracking net income in recent years (near 1x in 2025), indicating earnings quality is generally good. However, free cash flow declined in 2025 (negative growth) after prior growth, pointing to higher reinvestment needs or working-capital drag. Operating cash flow remains positive and sizable, but the provided coverage metric is relatively low and has not improved meaningfully, suggesting some volatility in cash conversion.

Breakdown	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	3.01B	2.84B	2.59B	2.23B	1.71B
Gross Profit	665.87M	643.46M	575.54M	516.18M	405.01M
EBITDA	488.32M	450.73M	396.53M	338.49M	270.45M
Net Income	261.38M	246.52M	216.16M	173.51M	151.20M
Balance Sheet
Total Assets	2.97B	3.11B	2.35B	2.03B	1.48B
Cash, Cash Equivalents and Short-Term Investments	442.67M	343.00M	300.63M	186.98M	298.36M
Total Debt	281.03M	302.14M	290.31M	253.53M	151.32M
Total Liabilities	1.69B	1.95B	1.34B	1.19B	873.68M
Stockholders Equity	1.26B	1.14B	995.64M	833.22M	595.79M
Cash Flow
Free Cash Flow	362.06M	366.48M	297.67M	228.00M	256.73M
Operating Cash Flow	379.34M	422.87M	355.51M	245.07M	268.34M
Investing Cash Flow	-55.14M	-182.39M	-64.10M	-385.06M	-9.86M
Financing Cash Flow	-215.50M	-198.24M	-177.53M	21.86M	-182.35M

Hilan Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 26700.00
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For IL:HLAN, the sentiment is Negative. The current price of 26700 is above the 20-day moving average (MA) of 20918.00, above the 50-day MA of 22995.20, and above the 200-day MA of 25511.61, indicating a bearish trend. The MACD of -502.96 indicates Negative momentum. The RSI at 40.04 is Neutral, neither overbought nor oversold. The STOCH value of 14.09 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for IL:HLAN.

Hilan Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
FORTY	73 Outperform	₪6.24B	47.62	―	2.68%	1.94%	-8.81%
HLAN	68 Neutral	₪4.73B	18.10	22.56%	1.88%	7.39%	10.64%
ONE	66 Neutral	₪4.60B	24.02	―	2.55%	14.11%	25.79%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
MTRX	60 Neutral	₪9.25B	28.90	―	2.41%	8.82%	14.25%
MLTM	56 Neutral	₪1.90B	39.35	―	―	11.90%	13.57%