Sunday February 21, 2021 21 February 2021

NEWS BITES - MIDDLE EAST & NORTH AFRICA

Bank Hapoalim B.M. (TASE:POLI), Israel's largest Bank by market cap, rebounded after hitting a low for the day of NIS23.73 and rose back to test the 24.0 hurdle.

Bank Hapoalim B.M.'s stock price has increased 33.0 agorot (1.4%) from its previous trading session to close at NIS24.03. Compared with the TA-25 Index which rose 18.0 points (1.1%) in the day, the relative price increase was 0.3%. Today the stock traded at its 27-day high of NIS24.03. The last time the price hit that level was on Jan 25.

There were 744,760 shares worth NIS17.9 million ($5.2 million) traded today. The volume was 0.2 times the average daily trading volume of 4.3 million shares.

Bullish Turning Point

Price/Earnings of 17.8 close to historical low

The P/E of 17.8 is 0.3 times the highest average P/E of 53.5 in the last five years. This is a value criterion, according to Benjamin Graham who described as a value criterion "A P/E ratio down to less than four-tenth of the highest average P/E ratio the stock attained in the most recent five years".

POLI Stock Dashboard (traded in NIS)

CurrencyUSD 1 = NIS 3.42 SectorBank
Feb 21 closeNIS24.03Market CapNIS31.7 billion [$9.3 billion]
P/E (FY2019)17.8EPS (FY2019)NIS1
EPS Growth % (Q3 2020 vs Q3 2019)10.9DPS (TTM)75 agorot
Ave Daily Volume4,288,399 sharesShares Outstanding1,320,573,814
52-Week Range (In NIS)16.86 - 28.88

BKHYY ADR Dashboard (traded in $)

Home ExchangeIsrael% of shares outstanding0.01%
CodeBKHYYRatio1 ADR equals 5 ordinary shares
ISINUS0625103009TypeSponsored
CUSIP062510300Feb 08 close$36.0
*No. Held by Institutions19,469Ave Daily Volume506 ADRs
Number of shares equivalent97,345

*Total ADRs Held by Institutions 19,469; equivalent to 97,345 Bank Hapoalim shares on issue. This represents 0.01% of total shares on issue.

INDEX

SECTION 1 CORPORATE PROFILE

SECTION 2 TODAY'S BULLISH SIGNALS

SECTION 3 ONGOING BULLISH PARAMETERS

SECTION 4 TODAY'S BEARISH SIGNALS

SECTION 5 ONGOING BEARISH PARAMETERS

SECTION 6 BANK METRICS

GLOSSARY

DATA & ARCHIVE DOWNLOAD CENTER

POLI: EXCEL TABLES ARE AVAILABLE TO EXPORT DATA:

+ PRICE VOLUME - 5-YEAR HISTORY

+ PEER COMPARISON - STOCK IN BANK SECTOR AND STOCK IN INDICES

POLI: LINKS IN HTML TO FURTHER INFORMATION:

+ NEWS ARCHIVES - POLI PAST 3 YEARS IN HTML:

+ PRICE VOLUME CHARTS IN HTML

SECTION 1 CORPORATE PROFILE

1.1 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.

1.2 Contact Details

Websitehttp://www.bankhapoalim.co.il
Physical Address50 Rothschild Boulevard Tel Aviv, 66883 Israel
Phone972-3-5673333
Fax972-3-5674576
EmailYORAM.WEISSBREM@MAILPOALIM.CO.IL

1.3 Industry & Sector

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

SECTION 2 TODAY'S BULLISH SIGNALS

2.1 Momentum Up 1.8% Past Week

Week 8 of 2021: Up 1.8%; bank Hapoalim B.M. outperformed the TA-25 index in 4 out of 5 days. The price ranged between a low of NIS23.05 on Feb 14 and a high of NIS23.75 on Feb 17.

FebBank Hapoalim B.M.Close price [NIS]Price change %Relative change % *Comment
Sun 14Down 2.3% in 2 days23.05-1.0-0.9Week-low of 23.05; Steepest Fall
Mon 15Increases 1.8% on rising relative strength23.461.80.9Top Rise
Tue 16Adds NIS317 million ($93 million) (1.0%) in MCap, top heavyweight rise in Bank sector23.71.01.0Price rise on beating relative strength
Wed 17Keeps rising, up 3.0% in 3 days23.750.20.9Week-high of 23.75
Thu 18Decreases23.7-0.20.9

* Relative change is price change of stock with respect to Benchmark Index, TA-25 index.

2.2 Rank in the top 12% by Price Performance in the Israel market

DescriptionValueRank
1-week Price Change %4.3In Top 12%

2.3 Uptrend

Beta > 1 combined with price rise. The Beta of the stock is 1.1.

Positive MACD:

- The Moving Average Convergence Divergence (MACD) indicator of 12-day Exponential Moving Average (EMA) of 23.63 minus the 26-day EMA of 23.44 is positive, suggesting a bullish signal. Both the 12-day EMA as well as the 26-day EMA are rising, another bullish signal.

2.4 Undervaluation

Price/Earnings:

Bank Hapoalim B.M. stock is trading at the seventh lowest P/E multiple in the TA-25 Index.

Earnings Yield of 5.6% > Israel ave of 4.2% > Bond Yield of 1.0%:

- Earnings yield of 5.6% is greater than the Israel average earning yield of 4.2%.

- The earnings yield of 5.6% is 5.5 times the 10-year bond yield of 1.0%.

(All figures in %)

Earnings Yield5.6
Israel avg4.2
Bond Yield1.0

SECTION 3 ONGOING BULLISH PARAMETERS

3.1 Present Value of NIS1000 Invested in the Past [3 Mo, 3 Yrs]; The Best Periods with PVNIS1000 > 1,071

PVNIS1,0003 mo ago3 yrs ago
POLI.TASENIS1,079NIS1,072
Bank sectorNIS1,093NIS1,078
TA-25 IndexNIS1,132NIS1,071

3.2 Annualised Period-based Total Shareholder Returns [TSR %]: The Best Periods with TSR > 5.6%

TSR %5 yrs10 yrs
POLI.TASE9.65.7

3.3 Increased Volume, up 66% in 5 years

In the past five years, Average Daily Volume of Trading (ADVT) has increased 66.4% to 4.3 million shares.

Avg. Daily Volume Traded 12 months ended Feb 21, million shares

YearADVT
20214.3
20202.3
20192.1
20182.6
20172.6

3.4 Increased VWAP, up 10% in 5 years

In the past five years Volume Weighted Average Price (VWAP) has increased by 10.3% to NIS21.36. .

Past five years, 12 months ended Feb 21 (NIS)

YearHigh PriceVWAPLow Price
202128.321.3616.86
202029.7826.3623.25
201926.5124.3221.51
201824.9722.5319.75
201722.1919.3716.91

3.5 Increased share turnover, up 51% in 5 years

In the past five years, average daily share turnover has increased 51.4% to NIS74.4 million ($21.7 million). This suggests increased liquidity.

Past five years, 12 months ended Feb 21 (NIS million)

YearAverage Daily Turnover
202174.4
202059.8
201949.9
201856.8
201749.1

SECTION 4 TODAY'S BEARISH SIGNALS

4.1 Rank in the bottom 21% by Price Performance in the Israel market

DescriptionValueRank
PV1000 [1 yr] $849In Bottom 21%

4.2 Downtrend

Trailing Relative Strength (6 months) at 35 percentile:

- The stock has a 6-month relative strength of 35 in the Israel market of 318 stocks which means it has underperformed 65% of the market.

4.3 Overvaluation

Price/Earnings of 17.8 > sector avg of 10.7:

- Price/Earnings of 17.8 versus sector average of 10.7.

4.4 Overbought/Bearish/Resistance Signals:

- At NIS24.03 the price has risen above the upper Bollinger band resistance of NIS24.01, indicating a downside risk for it to fall back within the band.

SECTION 5 ONGOING BEARISH PARAMETERS

5.1 Present Value of NIS1000 Invested in the Past Year; The Worst Period with PVNIS1000 < 837

PVNIS1,0001 yr ago
POLI.TASENIS836
Bank sectorNIS852
TA-25 IndexNIS930

5.2 Past year: price fall of 16.4%

1-Year price change of -16.4% for Bank Hapoalim B.M. underperformed the change of -7% in the TA-25 index for a relative price change of -9.4%.

Price Change %Year
Bank Hapoalim B.M.-16.4
Bank sector-14.8
TA-25 index-7

5.3 Moving Annual Return of -16.4% in the past year:

Moving Annual Return was -16.4% in the past year. Based on a dynamic start date of 5 years ago, the real rate of return has averaged 10.9%

POLIClose (NIS)Dividends (NIS)Capital Gain / (Loss) %% YieldAnnual Return %
Feb 2124.03-(16.4)-(16.4)
1 Yr ago28.750.7520.83.124.0
2 Yrs ago23.790.371.71.63.3
3 Yrs ago23.40.658.8311.8
4 Yrs ago21.510.5128.73.131.7

Close 5 years ago NIS16.72

5.4 EPS growth [FY2019 vs FY2018] of -30.8%:

FYEPS (NIS)Growth %
20191.35-30.8
20181.95-2.5

5.5 Annualised Period-based Total Shareholder Returns [TSR %]: The Worst Periods with TSR < 2.4%

TSR %1 yr3 yrs
POLI.TASE-16.42.3

5.6 Satisfies 3 out of 9 criteria of Joseph Piotroski [pass mark 5]:

- Positive net income.

- Positive operating cashflow.

- Good quality of earnings [operating cashflow exceeds net income].

SECTION 6 BANK METRICS

6.1 Bank Metrics (FY2019)

DescriptionNIS B FY2019NIS B FY2018]Change
Interest Income11.9 11.7 Up 2.1%
Interest Expense2.6 2.8 Down 6%
Net Interest Income9.3 8.9 Up 4.6%
Provision1.3 613 Up 108.2%
Net Interest Income After Provision8 8.3 Down 3%
Total Non Interest Income3.9 4.9 Down 20.1%

Favourable Changes:

- Interest Income up 2.1% from NIS11.7b to NIS11.9b

- Interest Expense down 6% from NIS2.8b to NIS2.6b

- Net Interest Income up 4.6% from NIS8.9b to NIS9.3b

Unfavourable Changes:

- Provision up 108.2% from NIS613m to NIS1.3b

- Net Interest Income After Provision down 3% from NIS8.3b to NIS8b

- Total Non Interest Income down 20.1% from NIS4.9b to NIS3.9b

GLOSSARY

ADVT: Average Daily Volume of shares Traded

Annual Return: Dividends Paid In a 12-Month Period/Price at the Beginning of the Period + Capital Gain or Loss over 1 Year/Price 1 Year Ago (%)

Banks Non-interest Income to Total Income: Non-Interest Income (Loan fees etc)/Total Income (Net Interest Income + Non-Interest Income)

Earnings Yield: Earnings Per Share/Share Price (%)

PV1000: Present value of 1000 invested 1 year/'n' years ago

Price/Earnings: Share Price/Earnings Per Share (times)

Relative Price Change [RPC]: Relative price change is price change of stock with respect to Benchmark Index

Relative Strength (6 Months): Price close today/Price close 6 months ago, then ranked by percentile within the entire market.

TSR: Total Shareholder Returns is expressed as an annualized rate of return for shareholders after allowing for capital appreciation and dividend

TTM: Trailing 12 Months

Volume Index (VI): Number of shares traded in the period/Average number of shares traded for the period

Volume Weighted Average Price (VWAP): The Volume Weighted Average Price (VWAP) is the summation of turnover divided by total volume in the same period.

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