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Harel Insurance Investments & Financial Services Ltd (HARL) Report Analysis

Corporate Events

Positive

Harel Insurance Investments & Financial Service...

2022-03-29 00:00:00

Harel Insurance Investments & Financial Services Ltd, 1.4094922 (ILS), Cash Dividend, Apr-05-2022

Positive

Harel Insurance Investments & Financial Service...

2021-11-30 00:00:00

Harel Insurance Investments & Financial Services Ltd, 0.4684713 (ILS), Cash Dividend, Dec-07-2021

Positive

Harel Insurance Investments & Financial Service...

2021-11-30 00:00:00

Harel Insurance Investments & Financial Services Ltd (TASE:HARL) signed memorandum of understanding to acquire Shirbit Insurance Co Ltd. on Ma...

Positive

Mindspace Ltd. announced that it has received $...

2021-11-24 00:00:00

Mindspace Ltd announced it has received $72 million in a round of funding led by Harel Insurance Investments and Financial Services Ltd. on No...

Positive

OpenWeb Technologies Ltd. announced that it has...

2021-11-09 00:00:00

OpenWeb Ltd. announced that it has received $150,000,000 in its series E round of funding co-led by new investor, Georgian and existing invest...

Positive

Biond Biologics Ltd announced that it has recei...

2021-11-03 00:00:00

Biond Biologics Ltd announced that it has received $15 million in a round of funding led by new investor Deep Insight on November 3, 2021. The...

Positive

Lightricks Ltd. announced that it has received ...

2021-09-19 00:00:00

Lightricks Ltd. announced that it has received $100,000,000 in its series D round of funding co-led by existing investor, Insight Venture Mana...

Positive

Aktibo, Inc. announced that it has received $26...

2021-09-14 00:00:00

Aktibo, Inc. announced that it has received $26,000,000 in a round of funding led by new investor MoreTech Ventures on September 14, 2021. The...

Positive

Harel Insurance Investments & Financial Services Ltd, 1.4094922 (ILS), Cash Dividend, Apr-05-2022

2022-03-29 00:00:00

Harel Insurance Investments & Financial Services Ltd, 1.4094922 (ILS), Cash Dividend, Apr-05-2022

Positive

Harel Insurance Investments & Financial Services Ltd, 0.4684713 (ILS), Cash Dividend, Dec-07-2021

2021-11-30 00:00:00

Harel Insurance Investments & Financial Services Ltd, 0.4684713 (ILS), Cash Dividend, Dec-07-2021

Positive

Harel Insurance Investments & Financial Services Ltd (TASE:HARL) completed the acquisition of Shirbit Insurance Co Ltd. for approximately ILS 100 million.

2021-11-30 00:00:00

Harel Insurance Investments & Financial Services Ltd (TASE:HARL) signed memorandum of understanding to acquire Shirbit Insurance Co Ltd. on May 5, 2021. Post completion, Shirbit Insurance Co Ltd. will apparently continue to operate independently. The transaction is subject to regulatory approval and satisfactory due diligence. Harel Insurance Investments & Financial Services Ltd (TASE:HARL) completed the acquisition of Shirbit Insurance Co Ltd. on November 30, 2021. On July 20, 2021, Harel Insurance signed an agreement with Shirbit, according to which, subject to satisfying suspensive conditions, Harel Insurance will acquire the insurance activity of Shirbit in consideration of approximately ILS 100 million.

Positive

Mindspace Ltd. announced that it has received $72 million in funding from Harel Insurance Investments & Financial Services Ltd, Intergemel Provident Funds and Pension Ltd., Arkin Holdings, Globalworth Real Estate Investments Limited and other investors

2021-11-24 00:00:00

Mindspace Ltd announced it has received $72 million in a round of funding led by Harel Insurance Investments and Financial Services Ltd. on November 24, 2021. The transaction also included participation from Intergemel Provident Funds and Pension Ltd., Arkin Holdings and existing investors Yoav Harlap, Kobi Rogovin and Globalworth Real Estate Investments Limited. Harel Insurance Investments and Financial Services Ltd. contributed $30 million in the round.

Positive

OpenWeb Technologies Ltd. announced that it has received $150 million in funding from a group of investors

2021-11-09 00:00:00

OpenWeb Ltd. announced that it has received $150,000,000 in its series E round of funding co-led by new investor, Georgian and existing investor, Insight Venture Management, LLC on November 9, 2021. The transaction includes participation from Harel Insurance Investments & Financial Services Ltd, Entrée Capital Limited, new investors, The New York Times Company, Dentsu Group Inc. and Samsung NEXT, LLC, individual investors, Omer Cygler and Scott Galloway. The company has raised $223,000,000 in funding till date. The round is raised at a post-money valuation of over $1,000,000,000. As part of the round, Scott Galloway has joined the company's board of directors.

Positive

Biond Biologics Ltd announced that it has received $15 million in funding from Deep Insight, Heritage group, Harel Insurance Investments & Financial Services Ltd and other investors

2021-11-03 00:00:00

Biond Biologics Ltd announced that it has received $15 million in a round of funding led by new investor Deep Insight on November 3, 2021. The transaction also included participation from new investors including Heritage group, and existing investors including Harel Insurance Investments & Financial Services Ltd. As part of the transaction, Barak Ben Eliezer of Deep Insight will join the board of directors of the company.

Positive

Lightricks Ltd. announced that it has received $100 million in funding from a group of investors

2021-09-19 00:00:00

Lightricks Ltd. announced that it has received $100,000,000 in its series D round of funding co-led by existing investor, Insight Venture Management, LLC and Hanaco Venture Capital Ltd. on September 19, 2021. The transaction includes participation from new investors, Migdal Insurance and Financial Holdings Ltd., Altshuler Shaham Group, Shavit Capital, and existing investors, West Street Capital Partners, ClalTech, Harel Insurance Investments & Financial Services Ltd and Greycroft Partners LLC. The company has raised $335,000,000 in both primary and secondary funding till date. The round is raised at a post-money valuation of approximately $1,800,000,000.

Positive

Aktibo, Inc. announced that it has received $26 million in funding from Raptor Holdco GP LLC, MoreTech Ventures, Falcon Edge Capital, LP, Harel Insurance Investments & Financial Services Ltd and other investors

2021-09-14 00:00:00

Aktibo, Inc. announced that it has received $26,000,000 in a round of funding led by new investor MoreTech Ventures on September 14, 2021. The transaction included participation from new investors Raptor Holdco GP LLC, Falcon Edge Capital, LP, Harel Insurance Investments & Financial Services Ltd. and existing investors.

Fundamental Summary

When Harel released its Q1 results on 2022-05-30, a lot of their metrics were unimpressive and weak. While its income and value factors looked weak, the overall picture, which includes income metrics, painted a different picture related to their likelihood to overperform moving forward. In statistics, this is called the Simpson Paradox (https://www.britannica.com/topic/Simpsons-paradox). With all the factors considered, Harel received an overall score of 74, which translates to a HOLD recommendation.

Harel reported earnings results for the first quarter ended March 31, 2022. For the first quarter, the company reported revenue was ILS 4,013 million compared to ILS 6,774 million a year ago. Net income was ILS 620 million compared to ILS 243 million a year ago. Basic earnings per share from continuing operations was ILS 2.89 compared to ILS 1.13 a year ago. Diluted earnings per share from continuing operations was ILS 2.89.

Business Description

Harel 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.

Sector Overview

Harel is included in the Insurance according to GICS (global industry classification standard). The Interactive Media & Services industry is part of the Communication Services sector. It includes companies that create or distribute content and information through proprietary platforms, with revenue generated primarily through pay-per-click ads (i.e. search engines, social media and networking platforms, online classifieds, and online review companies). Harel's industry and sector affiliation are expected to negatively affect their likelihood to overperform the market in the upcoming period, as other sectors appear more likely to benefit from the macroeconomic environment we see now.

Fundamental Highlights


Parameter Value Change Score
Assets 139,114.0 1.0% 71
Liabilities 130,200.0 1.1% 72
Price to Book 0.8 -1.5% 62
Cash & Equivalents 6,273.0 -17.9% 55
Equity 8,881.0 0.2% 44
EBITDA 2,164.0 37.0% 77
Total Revenues 24,375.0 -10.2% 95
Parameter Value Change Score
Return on Equity 19.1 30.9% 93
Net Cashflow 1,592.0 25.9% 84
Capital Expenditure -40.0 11.1% 88
Asset Turnover 0.2 -11.8% 41
Free Cashflow 6.0 52.8% 45

* All values are TTM

The below chart reflects Harel's birds-eye view on its performance with respect to its peers, the company's fillings as reported or to a similar industry, market cap, and country of origin. While Harel's peer average final assessment score stands on 70.0, Harel's score is 74.

  •  HARL
  •  Peers average
Name Market Cap Balance Sheet Income Statement Cash Flow Rating Final Assessment mc_sort Hidden
The Phoenix Holdings Ltd. 9.2B 60 85 51
Hold
69
69 0 1
Migdal Insurance and Financial Holdings Ltd. 5.6B 77 87 47
Buy
81
81 1 1
Clal Insurance Enterprises Holdings Ltd. 4.8B 67 80 49
Hold
71
71 2 1
Menora Mivtachim Holdings Ltd 4.2B 68 80 51
Hold
72
72 3 1
I.D.I. Insurance Company Ltd. 1.4B 50 51 51
Underperform
43
43 4 1

Technical Analysis

When trying to optimize the timing of an investment, it's critical to analyze whether the stock looks overbought or oversold, and in which direction the momentum is moving. Harel's stock is now priced above its 5-day, but below its 50-day and 200-day moving average, while its MACD (moving average convergence divergence) indicates that the stock's price movement momentum is weakening. Historically, this is a positive setup in the near-term. Meanwhile, looking at the Stochastic Oscillator and RSI (relative strength index), Harel's stock indicates that it's likely oversold. Overall, these technical indicators signal negative momentum. Therefore, this stock received a cumulative TA (technical analysis) score of 47.

Bearish 47
Close Price 35.12
52W Low 29.64
52W High 42.08
5D MA 34.65
50D MA 36.73
200D MA 36.28
MACD -0.59
RSI 22.62
STOCH 88.46

Balance Sheet Analysis

Overall, Harel's critical balance sheet metrics appear to signal strong support and a high likelihood of positive growth going forward. Harel has done an excellent job managing its liabilities. Harel's liabilities stood at 130200.0 in the current filing, which represents a 1.1% change from the previous report. These liabilities changes appear balanced compared to their peers and project the message that management is capable and focused on balancing asset growth, resource allocation, and growing liabilities. Therefore, we rated their liabilities movement with a score of 72. Also, The company's assets section could set high expectations for Harel's future attractiveness, as they went to 139114.0, which is a 1.0% change from the last period. This growth should support upward pressure on its's stock price, which better captures their intrinsic value. Therefore, its asset component earned a score of 71. However, one discouraging result, Equity, stood out. Harel reported weak equity changes momentum this period. At filing, equity was reported as 8881.0, representing 0.2% change from the previous report. This parameter often affects companies in the same industry and market capitalization by up to 7.1%. Their equity metrics appear unremarkable relative to their peers. Consequently, their equity movement received a grade of 44. Consequently, their balance sheet earned a rank of 60.

Parameter Value Change Score
Assets 139,114.0 1.0% 71
Liabilities 130,200.0 1.1% 72
Price to Book 0.8 -1.5% 62
Cash & Equivalents 6,273.0 -17.9% 55
Equity 8,881.0 0.2% 44
* All values are TTM

The below chart describes Harel's performance as reflected on its balance sheet with respect to its peers. While Harel received a balance sheet score of 60, the average of its peers stands on 72.0.

  •  HARL
  •  Peers average
Name Market Cap Liabilities Movement Asset Change Equity/Intangibles Adjustments Cash & Equivalents Book Value Momentum Balance Sheet mc_sort Hidden
The Phoenix Holdings Ltd. 9.2B 73 41 47 75 59 60 0 1
Migdal Insurance and Financial Holdings Ltd. 5.6B 59 38 86 58 81 77 1 1
Clal Insurance Enterprises Holdings Ltd. 4.8B 63 70 40 65 74 67 2 1
Menora Mivtachim Holdings Ltd 4.2B 63 45 51 59 75 68 3 1
I.D.I. Insurance Company Ltd. 1.4B 74 76 58 46 46 50 4 1

Income Statement Analysis

Two metrics jump up as the most significant positive drivers of the income statement's strength in Harel's recent report: Revenue Efficiency and Return Factors. Harel did an excellent job managing its revenue efficiency this past period. Harel's revenue efficiency is 24375.0 according to the metrics in the current filing, which represents a -10.2% change from the previous report. This characteristic can affect companies in the same industry and market capitalization by up to 2.3%. Their industry-leading revenue efficiency makes a strong case for upward pressure on its's stock price. Consequently, their revenue efficiency received a grade of 95. Also, Harel's reported return on equity (ROE) ratio was 19.1, representing a change of 30.9%. The company appears headed in the right direction in terms of these return factors, exhibiting prudent capital expenditure growth compared to its peers. Therefore, its return factors component earned a score of 93. On the other hand, EBITDA, jumped out as looking problematic. Harel's EBIDTA now sits at 2164.0 and represents 37.0% change from the last reporting period. This metric might have a 7.9 percent impact on companies in the same industry and with the same market capitalization. The company's EBITDA metrics highlight a difficult overall financial situation, which may, unfortunately, continue moving forward unless management makes significant changes. Its EBITDA movement, therefore, received a grade of 77. As the companie's management is doing an excellent job managing the critical metrics, the income statement was given a score of 86.

Parameter Value Change Score
EBITDA 2,164.0 37.0% 77
Total Revenues 24,375.0 -10.2% 95
Return on Equity 19.1 30.9% 93
* All values are TTM

The below chart describes Harel's performance as reflected on its income statement with respect to its peers. While Harel received a income statement score of 86 , the average of its peers stands on 67.0.

  •  HARL
  •  Peers average
Name Market Cap Revenue Momentum Earning Movement Return Factors Momentum Income Statement mc_sort Hidden
The Phoenix Holdings Ltd. 9.2B 96 77 91 85 0 1
Migdal Insurance and Financial Holdings Ltd. 5.6B 97 78 94 87 1 1
Clal Insurance Enterprises Holdings Ltd. 4.8B 96 76 81 80 2 1
Menora Mivtachim Holdings Ltd 4.2B 95 76 81 80 3 1
I.D.I. Insurance Company Ltd. 1.4B 82 58 44 51 4 1

Cash Flow Analysis

Harel appears likely to maintain its strong cash flow metrics and momentum going forward. Harel's published capital expenditures (CapEx) numbers were encouraging and reflected management's balanced change strategy. Harel recorded CapEx of -40.0, which represents 11.1% change from the previous report. This remarkable CapEx growth is expected to reinforce upward momentum for its's stock price going forward. Consequently, their CapEx movement received a grade of 88. Also, Harel's management was effective in improving their net cash flow, which now sits at 1592.0 and represents a 25.9% change from the previous report. The company is headed in the right direction regarding business priorities, exhibiting prudent net cash flow management and growth. The company's net cash flow, therefore, received a grade of 84. That said, one metric, Asset Turnover, stood out as strongly negative. Harel's asset turnover numbers were discouraging, reflecting significant concerns related to management's ability to leverage assets to generate sales effectively and efficiently. Harel recorded asset turnover of 0.2, which represents a -11.8% change from the previous report. Companies in the same industry and market capitalization are typically affected by this parameter by up to 2.8%. The company's asset turnover metrics seem especially problematic relative to their peers. Underwhelming results in asset turnover metrics often lead to negative pressure in stock prices, so we rated its asset turnover momentum 41. Consequently, its cash flow earned a score of 68.

Parameter Value Change Score
Net Cashflow 1,592.0 25.9% 84
Capital Expenditure -40.0 11.1% 88
Asset Turnover 0.2 -11.8% 41
Free Cashflow 6.0 52.8% 45
* All values are TTM

The below chart describes Harel's performance as reflected on its cash flow with respect to its peers. While Harel received a cash flow score of 68, the average of its peers stands on 68.0.

  •  HARL
  •  Peers average
Name Market Cap Cashflow Momentum Free Cashflow Growth Capital Expenditure Growth Assets Factors Momentum Cash Flow mc_sort Hidden
The Phoenix Holdings Ltd. 9.2B 58 82 45 39 51 0 1
Migdal Insurance and Financial Holdings Ltd. 5.6B 49 89 48 39 47 1 1
Clal Insurance Enterprises Holdings Ltd. 4.8B 47 88 60 40 49 2 1
Menora Mivtachim Holdings Ltd 4.2B 46 92 60 40 51 3 1
I.D.I. Insurance Company Ltd. 1.4B 45 94 51 54 51 4 1

This report is intended for general guidance and information purposes only and under no circumstances is tailored to a specific factor or variable related to its reader or intended to be used or considered as financial or investment advice, a solicitation of any offer, a recommendation, or an offer to sell or buy any securities or other form of a financial asset. For the full disclaimer, click here.