Israeli stock report - Bank Hapoalim B.M.

ISRAEL

Bank Hapoalim B.M. increases July 20, 2017 17:30 IDT

NEWS BITES - MIDDLE EAST & NORTH AFRICA

Bank Hapoalim B.M. (TASE:POLI), Israel's largest Bank by market cap, has increased 1.0 agorot (0.04%) from its last trading session of July 19 to close at NIS25.11. Compared with the TA-25 Index which rose 2.9 points (0.2%) in the day, the relative price change was -0.2%. The volume was 0.6 times the average daily trading volume of 2.9 million shares.

SECTION 1

BANK HAPOALIM B.M. BULLISH SIGNALS

1.1 Fundamentals:

+ The P/E of 12.8 multiplied by the P/NTA of 1 is 12.4. Being less than the Benjamin Graham benchmark of 22.5 the stock appears undervalued.

+ The relative yield of the stock, defined by its yield of 2.3%, divided by average yield of dividend yielding stocks in the TA-25 Index of 1.7% is 140.4%. This suggests the stock is undervalued in dividend yield terms.

1.2 Undervaluation [compared with sector average]:

+ Dividend yield of 2.3% [1.6%].

1.3 Technicals:

+ The Moving Average Convergence Divergence (MACD) indicator of 12-day Exponential Moving Average (EMA) of 24.85 minus the 26-day EMA of 24.41 is positive 0.44 suggesting a bullish signal. Both EMA prices are rising, another bullish signal.

+ Rises to Falls: in the past month the number of rises outnumbered falls 14:8 or 1.8:1.

+ In the last three months the stock has hit a new 52-week high eight times, pointing to a significant uptrend.

+ The present value of NIS1,000 (PV1000) invested one year ago in Bank Hapoalim B.M. is NIS1,319, comprising a capital gain of NIS285 and dividend reinvested of NIS34.

PV10001-week1-month1-year
POLI.TASE9921,0391,319
TA-25 Index1,0021,014993

+ The present value of NIS1,000 (PV1000) invested ten years ago in Bank Hapoalim B.M. is NIS1,456, including a capital gain of NIS332 and dividend reinvested of NIS125.

+ 10 years Multiplier in NIS = 1.456x

+ Compound Annual Growth Rate (CAGR) in NIS = 3.8%

Present Value of USD1,000 invested 10 years ago:

+ The present value of USD1,000 (PV1000) invested ten years ago in Bank Hapoalim B.M. is $US1,740, including a capital gain of $US591 and dividend reinvested of $US149.

+ 10 years ago USD 1 equalled NIS 4.2717

+ 10 years Multiplier in USD = 1.74x

+ Compound Annual Growth Rate (CAGR) in USD = 5.7%

Jul 20, 2017: USD 1 equals NIS 3.58

1.4 High Performance Indicators:

DescriptionValueRank In Market
Today's TurnoverNIS41.9 million (US$11.7 million)In Top 1%
Price/MAP501.06In Top Quartile
Volatility %0.7In Top Quartile
EBITDA Margin %48.6In Top Quartile
Price/MAP2001.11In Top Quartile

SECTION 2

BANK HAPOALIM B.M. BEARISH SIGNALS

2.1 Fundamentals:

+ Total Liabilities/EBITDA of 83.4 which compares unfavourably with the Joseph Piotroski benchmark of 5.

+ As per the Du Pont analysis, Return on Equity is less than stellar at 7.7%. This is computed as net profit margin of 25.5% times asset turnover [sales/assets] of 0.02 times leverage factor [total assets/shareholders' equity] of 13.2. Also, this has deteriorated from 9.3% last year.

Du Pont AnalysisROEProfit MarginAsset TurnoverEquity Multiplier
Current Year7.725.50.0213.2
Previous Year9.330.50.0213.1

+ Earnings per share growth rate has shown signs of deterioration in recent years. [Year ended, all figures in %]

YearRevenue GrowthEPS GrowthEBITDA Growth
Dec 163.7-14.7-2.8
Dec 15-13.2-30.3

2.2 Overvaluation [compared with sector average]:

+ Price/Earnings of 12.8 [11.1].

2.3 Technicals:

+ The price decreased 0.8% in the last week.

+ The 1.7% discount to 12-month high of NIS25.55 against the 33.3% premium to 12-month low of NIS18.83 suggests the climb might be peaking.

2.4 Overbought/Bearish/Resistance Signals:

+ The Relative Strength Index (RSI) of 81.4 has penetrated the overbought line of 70, suggesting the price gain of 5.3% in the last 14 days is unusually high.

+ The Money Flow Index [MFI] is 85.2 suggesting an overbought 14-day trend, being above 80. The Money Ratio of 5.8 suggests positive money flow was 5.8 times negative money flow.

2.5 Low Performance Indicator:

DescriptionValueRank In Market
Return on Assets [ROA] %0.6In Bottom Quartile

SECTION 3

PRICE VOLUME DYNAMICS

3.1 Momentum:

+ Volume: there were 1,670,000 shares worth NIS41.9 million (US$11.7 million) traded today. In the past week, volume was 0.7 times average and the shares were down 0.8%.

3.2 Moving Annual Return

POLIClose (NIS)Dividends (NIS)Capital Gain / (Loss) %% YieldAnnual Return %
July 2025.110.5928.5331.5
1 Yr ago19.540.44(2.9)2.2(0.7)
2 Yrs ago20.120.355.91.97.7
3 Yrs ago190.3719.22.321.5
4 Yrs ago15.940.0750.10.750.8

3.3 Beta:

+ Beta: the Beta of Bank Hapoalim B.M. stock is 1.3. A Beta greater than 1 suggests this is a high risk, high return stock with volatility greater than that of the market.

3.4 Turnover Rate & Turnover Period:

+ The turnover rate in the 12 months to date was 49.3% (or a turnover period of 2 years 11 days). This average length of ownership of the stock at 0.7 times the average holding period of 2 years 10 months for stocks in the TA-25 Index suggests a slightly larger number of speculators on the share register, making it less safe for long-term investors.

SECTION 4

RANKING

4.1 Global Rank [out of 47,486 stocks] and Rank in the Asia Region [out of 22,000 stocks]

DescriptionValueGlobal RankIn Asia Region
MCap (US$)9.3B1,508452
Total Assets (US$)125.3B404101
Revenue (US$)2.9B3,2781,198
Net Profit (US$)731.7M1,252348
Return on Equity %7.716,2568,718
Net Profit Margin %25.54,3291,640
Price to Book1.010,2345,606
Price/Earnings12.76,4702,960
Yield %2.310,2194,403
PV$1000 (1Year) US$*1,4259,1334,288
US$* Change (1Year) %45.38,1173,897

* 1 year ago USD 1 = NIS 3.87

Jul 20, 2017: USD 1 equals NIS 3.58

4.2 Independent Ratings

Bank Hapoalim B.M. was ranked 151 in the Brand Finance list of the world's 500 Valuable Banking brands by brand value in 2015; an improvement over a year from rank 154 in 2014. Brand Finance valued the brand at US$1,058 million and ranked it Number 151 in Middle East.

It is the 1435th largest by revenue in the Forbes Global 2000.

It is placed 127/323 in BSS News Bites' ranking of Israel performers in the past year, a percentile ranking of 61.

SECTION 5

BANK HAPOALIM B.M. FINANCIALS

5.1 Financials Summary

Year endedDec 2016Dec 2015Dec 2014
Sales (USD B)2.943.9
Pretax (USD B)1.41.41.2
Net (USD M)737.5851.1764.8
EPS (NIS)1.972.312.04

5.2 Annual Report for the year ended December 31, 2016 (year-on-year comparisons with previous corresponding period)-

Bank Hapoalim B.M. Net Profit down 13.3%

Favourable Changes:

+ Sales and marketing expenses to Sales down from 50.2% to 46.9%.

+ Debt to Equity down 4.8% from 1.1 to 1.0.

+ Cash to Total Assets up from 15.1% to 17.9%.

+ Net tangible assets per share up 2.9% from NIS24.77 ($US6.3) to NIS25.5 ($US6.6).

Unfavourable Changes:

+ Net profit down 13.3% from NIS3.0b ($US773.4m) to NIS2.6b ($US680.3m)

+ EPS down 14.7% from NIS2.31 (US59.18c) to NIS1.97 (US51.23c).

+ EBIT Margin down from 51.8% to 48.6%.

+ EBIT to total assets down from 1.2% to 1.1%.

+ Profit before tax to Sales down from 51.8% to 48.6%.

+ Other non-current assets to Total Assets down from 69.5% to 65.2%.

+ Total Liabilities to EBITDA of 83.4 compares unfavourably with the Joseph Piotroski benchmark of <5. This ratio has deteriorated by 6.9% from the previous year's ratio of 78.1.

+ Total Liabilities to Operating Cash Flow of 21.6 compares unfavourably with the Joseph Piotroski benchmark of <4. However, it has improved by 34.3% from the previous year's ratio of 32.9.

Note:

+ Tax expenses to Sales up from 21.3% to 23.1%.

+ Short-term investments to Total Assets up from 14.6% to 16%.

+ Fixed Assets to Total Assets steady at 0.8%.

5.3 Trailing 12 Months Dividends

Trailing 12 Months ToValue (agorot)
20 Jul 201758.6
20 Jul 201644.35
20 Jul 201535.27
20 Jul 201437
20 Jul 20137

SECTION 6

BANK HAPOALIM B.M. PROFILE

6.1 Activities

Bank Hapoalim is an Israel-based banking and financial institution which has a network of 252 branches and eight regional business centres in Israel and a presence in many countries.

6.2 Industry & Sector

Classification LevelName of Sector
Economic SectorFinancials
Business SectorBanking & Investment Services
Industry GroupBanking Services
IndustryBanks

6.3 Issued Capital

Based on 1,320,573,814 issued shares the market capitalisation is NIS33.2 billion (US$9.3 billion).

SECTION 7

STOCK BUZZ

Corporate Wire

To view Recent Company Headlines, click here

June 06: Bank Hapoalim B.M. announces dividend

April 04: Bank Hapoalim B.M. announces dividend

March 30: Bank Hapoalim Announces 2016 Financial Results

March 08: Bank Hapoalim B.M. announces EGM

November 15 2016: Bank Hapoalim B.M. announces EGM

Contact: 972-3-5673333

Physical Address: 50 Rothschild Boulevard Tel Aviv, 66883 Israel

State/Province/Country: Israel

Country of Incorporation: Y

Exchange: Tel Aviv Stock Exchange

ISIN: IL0006625771

TV:POLI; TLV:POLI; TA:POLI; TA:POLI; IT:POLI; POLI.TA

PermID: 4295875283

Bank Hapoalim Bm

Source: www.BuySellSignals.com