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Bank Leumi Le-Israel (IL:LUMI)
:LUMI
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Leumi
(LUMI)
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Rating:80Outperform
Price Target:
8,509.00
â–²(13.57% Upside)
Bank Leumi's strong financial performance and positive earnings call sentiment are the most significant factors driving the score. Technical indicators show bullish momentum, though caution is advised due to overbought signals. The valuation is reasonable, providing a balanced risk-reward profile.
Positive Factors
Strong Financial Performance
Leumi's robust profitability and high return on equity indicate strong operational efficiency and effective management, supporting long-term growth.
Improved Credit Quality
Improved credit quality with low credit loss expenses enhances financial stability and reduces risk, supporting sustainable growth.
Strategic Technology Implementation
High digital adoption reflects successful tech transformation, enhancing customer experience and operational efficiency, driving future growth.
Negative Factors
Decrease in Net Interest Income
Declining net interest income could pressure margins, impacting profitability if not offset by other income streams or cost controls.
Potential Regulatory Risks
Potential regulatory changes could increase costs and limit profitability, posing long-term challenges to financial performance.
Increasing Debt Levels
Rising debt levels may strain cash flow and financial flexibility, impacting the company's ability to invest in growth opportunities.
Leumi (LUMI) vs. iShares MSCI Israel ETF (EIS)
Market Cap
111.08B
Dividend Yield3.7%
Average Volume (3M)3.41M
Price to Earnings (P/E)11.0
Beta (1Y)1.03
Revenue Growth6.95%
EPS Growth12.41%
CountryIL
Employees7,833
SectorFinancial
Sector Strength70
IndustryBanks - Regional
Share Statistics
EPS (TTM)181.00
Shares Outstanding1,482,705,200
10 Day Avg. Volume3,842,144
30 Day Avg. Volume3,405,959
Financial Highlights & Ratios
PEG Ratio0.16
Price to Book (P/B)1.07
Price to Sales (P/S)2.98
P/FCF Ratio4.60
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
7,599.37Price Target Upside1.43% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering1
EPS Forecast (FY)N/A
Revenue Forecast (FY)N/A
Leumi Business Overview & Revenue Model
Company DescriptionBank Leumi le-Israel B.M., together with its subsidiaries, provides banking and financial services in Israel, the United States, the United Kingdom, and internationally. It operates through Households, Private Banking, Micro Businesses, Small Businesses, Mid-market, Corporations, Institutional Entities, and Financial Management segments. It provides housing loans, collateral loans, and loans to purchasing groups, including mortgage planning, accompanying the customer through the mortgage process, and recycling existing loans; and working capital, acquisitions, and term loans, as well as credit lines; financial support to Israeli high-tech companies; equipment lease financing; credit cards; and online banking services, as well as wealth and cash management services. The company also offers international trade financing, loan syndications and participations, foreign currency time deposits, and dealing room services. In addition, it provides provident funds, mutual funds, study funds, pension funds, and insurance products; invests in marketable securities, market-making activity involving securities and derivatives, repurchase and lending transactions involving securities, short selling of securities, and securities' underwriting services; engages in asset and liability management activities; and provides trust and custodial services for banks. Further, the company engages in the activities, such as advisory services, sale and management of loan portfolios, and development of financial products. Additionally, it provides banking services to private customers and small businesses, largest and multinational corporations, and middle-market companies, as well as financial services to institutional customers and foreign banks. The company operates approximately 250 branches. Bank Leumi le- Israel B.M. was founded in 1902 and is headquartered in Tel Aviv-Yafo, Israel.
How the Company Makes MoneyLeumi generates revenue through several key streams. Primarily, the company earns money from interest on loans provided to customers, including personal, business, and mortgage loans. Additionally, Leumi generates income from transaction fees related to payment processing services. The company may also derive revenue from asset management fees for investment services offered to clients. Strategic partnerships with technology firms and financial institutions enhance their service offerings and expand their customer base, further contributing to earnings. Overall, Leumi's revenue model is supported by a blend of interest income, fee-based income, and partnerships that enhance its product offerings.
Leumi Earnings Call Summary
Earnings Call Date:Nov 18, 2025
(Q3-2025)
| % Change Since: |
Next Earnings Date:Mar 10, 2026
Earnings Call Sentiment Positive
The earnings call highlighted Bank Leumi's strong financial performance, including substantial profits, effective cost management, and improved credit quality. However, there were minor concerns regarding the decrease in net interest income and potential regulatory changes that could impact future operations.Q3-2025 Updates
Positive Updates
Strong Financial Performance
Bank Leumi reported a net profit of ILS 2.7 billion and an ROE of 16.3% for Q3 2025. The cost-to-income ratio was exceptionally strong at 27%, down from 31.1% in Q3 2024.
Robust Dividend and Buyback Program
Following the Bank of Israel's approval, Leumi announced a combined dividend and buyback of ILS 2 billion, representing 75% of the quarterly net profit.
Improved Credit Quality
The credit loss expenses were 0.03% of gross loans, showing a positive development in the geopolitical environment. The NPL was at a low level of 0.41%, and the troubled debt ratio declined to 1.34% of gross loans.
Continued Credit Growth
Credit portfolio grew by 1.3% quarter-on-quarter and 8.8% over 9 months, driven by demand from corporates, real estate, infrastructure, mortgages, and middle market.
Strategic Technology Implementation
Nearly 90% of private customers conduct activities through digital platforms, reflecting the bank's successful technology transformation.
Negative Updates
Decrease in Net Interest Income
Net interest income decreased by 1.6% year-on-year, influenced by a lower CPI compared to Q3 2024.
Potential Regulatory Risks
Media headlines suggested an increased tax rate on banks and potential mortgage subsidies by the Finance Minister, which could require legislative action.
Company Guidance
During Bank Leumi's third quarter 2025 results conference call, CFO Hagit Argov highlighted the bank's robust financial performance, with a reported ROE of 16.3% and net profit of ILS 2.7 billion. The bank maintained a strong cost-to-income ratio of 27%, a notable improvement from 31.1% in Q3 2024, attributed to increased income and reduced costs through advanced technology. Leumi announced a dividend and buyback totaling ILS 2 billion, following the Bank of Israel's approval to increase the payout ratio to 75% of net profit. Credit quality improved with credit loss expenses at 0.03% of gross loans, down from 0.28% in the previous year, and troubled debt at 1.34% of gross loans. The bank's CET1 ratio stood at 12.33%, with a capital buffer exceeding 2% or ILS 11 billion. Liquidity remained strong with an LCR of 128%, and credit growth was robust at 8.8% over 9 months. The bank's focus on leveraging advanced technology has resulted in a leading cost-income ratio in the Israeli banking sector, enabling continued growth and enhanced shareholder returns.Leumi Financial Statement Overview
Summary
Leumi exhibits strong financial health with impressive revenue and net income growth. The balance sheet reflects stability with minimal debt and strong cash reserves. Despite positive cash flow trends, fluctuations in operating cash flows warrant attention. Overall, Leumi is well-positioned in the regional banking sector, with opportunities to enhance operational efficiency and equity growth.Income Statement
Leumi has demonstrated strong revenue growth over the years, with a 17.4% increase from 2023 to 2024. The net profit margin has improved to 44.4% in 2024, up from 37.4% in 2023, indicating enhanced profitability. However, the absence of EBIT and EBITDA margins in 2024 is a notable gap, making it challenging to assess operational efficiency comprehensively.Balance Sheet
Leumi maintains a robust equity position with an equity ratio of 7.85% in 2024. The debt-to-equity ratio is effectively nil, showcasing financial stability and minimal leverage risks. However, the equity growth has been moderate relative to total asset growth, which could be an area for improvement.Cash Flow
Cash flow performance has been solid, with a significant turnaround in free cash flow from -966 million in 2023 to 14.3 billion in 2024. The operating cash flow to net income ratio improved, indicating better cash conversion. However, volatility in operating cash flows over the years suggests potential cash flow management challenges.| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 43.66B | 43.02B | 38.66B | 22.80B | 16.82B | 14.43B |
| Gross Profit | 21.74B | 22.07B | 21.00B | 17.21B | 15.49B | 12.97B |
| EBITDA | 16.26B | 16.10B | 12.58B | 11.49B | 9.94B | 4.17B |
| Net Income | 10.16B | 9.80B | 7.03B | 7.71B | 6.03B | 2.10B |
Balance Sheet | ||||||
| Total Assets | 827.11B | 785.55B | 731.50B | 699.17B | 656.45B | 556.03B |
| Cash, Cash Equivalents and Short-Term Investments | 138.31B | 155.83B | 102.47B | 180.64B | 194.22B | 132.62B |
| Total Debt | 44.88B | 62.27B | 32.76B | 28.37B | 16.23B | 17.23B |
| Total Liabilities | 760.07B | 723.89B | 677.00B | 649.72B | 614.40B | 517.94B |
| Stockholders Equity | 67.04B | 61.66B | 54.50B | 49.44B | 41.61B | 37.66B |
Cash Flow | ||||||
| Free Cash Flow | 9.72B | 14.30B | -966.00M | 5.33B | 4.66B | 4.96B |
| Operating Cash Flow | 10.62B | 15.04B | -133.00M | 6.09B | 5.20B | 5.56B |
| Investing Cash Flow | -65.75B | -8.32B | -98.23B | -72.89B | -43.27B | -25.84B |
| Financing Cash Flow | 59.87B | 42.07B | 20.03B | 52.47B | 100.24B | 80.51B |
Leumi Technical Analysis
Positive
7492.00
Price Trends
6988.45
Positive
6595.39
Positive
6027.45
Positive
Market Momentum
98.31
Negative
63.51
Neutral
90.85
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For IL:LUMI, the sentiment is Positive. The current price of 7492 is above the 20-day moving average (MA) of 7189.70, above the 50-day MA of 6988.45, and above the 200-day MA of 6027.45, indicating a bullish trend. The MACD of 98.31 indicates Negative momentum. The RSI at 63.51 is Neutral, neither overbought nor oversold. The STOCH value of 90.85 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for IL:LUMI.
Leumi Peers Comparison
UnderperformOutperform
Sector (68)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
80 Outperform | 111.08B | 11.05 | 15.67% | 3.70% | 6.95% | 12.41% | |
80 Outperform | 62.60B | 11.29 | 16.87% | 4.11% | 11.00% | 6.03% | |
75 Outperform | 44.36B | 10.32 | 13.10% | 3.69% | 14.48% | 4.65% | |
69 Neutral | 26.45B | 11.39 | 16.48% | 4.57% | 14.16% | 1.05% | |
68 Neutral | $18.00B | 11.42 | 9.92% | 3.81% | 9.73% | 1.22% | |
64 Neutral | 100.75B | 11.00 | 15.13% | 3.54% | 19.05% | 18.98% |
* Financial Sector Average
IL:LUMI
Leumi
7,492.00
3,240.26
76.21%
IL:FIBI
Fibi Bank
26,360.00
8,682.53
49.12%
IL:DSCT
Discount
3,626.00
1,187.07
48.67%
IL:MZTF
Mizrahi Tefahot
24,080.00
8,561.89
55.17%
IL:POLI
Poalim
7,672.00
3,297.16
75.37%
IL:FIBIH
Fibi Holdings
27,600.00
9,410.80
51.74%
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.