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Barclays (LON:BARC) initiated coverage on Harel Insurance Investments & Financial Services (TASE:HARL) with an overweight rating and a price target of ILs97.00 on Monday.
The research firm cited Harel’s strong execution in high-barrier-to-entry segments, noting the company has secured a 36% market share in Health and 20% in Life insurance. Harel generated a 9% CAGR in premiums and deposits from 2020 to 2024, with total premiums reaching ILS 15.4bn and 15% year-over-year growth in pension deposits in 2024, outperforming peers’ averages of ILS 10.9bn and 10% respectively.
Barclays highlighted Harel’s solvency ratio of 182% as of the first quarter of 2025, which stands well above the industry average of 157%. The firm also expressed confidence in Harel’s strategic plan, which targets ILS 1.9-2.1bn in comprehensive income and 18-19% ROE by 2026.
Currently, 82% of Harel’s operating profit comes from insurance-related segments, compared to 55% at peer Phoenix Holdings, which began diversifying several years ago. Barclays views Harel’s commitment to revenue diversification as potentially compelling given its strong balance sheet.
The research firm also pointed to Harel’s significant investments in IT and artificial intelligence as creating substantial cross-selling and up-selling opportunities for the Israeli insurance company.
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