AUM 2025
583B ₪
+18.7% Y/Y | #2 in Israel
ROE 2025
22%
2024: 21% | 2028 target: 16-18%
Long-term Savings Profit Q4 2025
221M ₪
+264% Y/Y
Health Insurance Profit Q4 2025
128M ₪
+313% Y/Y
Dividend 2025
51M ₪
~50% payout | first in years
1 Company Profile
Migdal Insurance & Financial Holdings is one of the oldest and largest insurance and financial groups in Israel. Founded in 1934, it trades on the Tel Aviv Stock Exchange (symbol: Migdal, security 1081165) and is a constituent of the TA-35 index. Migdal is considered one of the "Big Five" Israeli insurers, together with The Phoenix, Clal Insurance, Harel, and Menora Mivtachim — five companies that collectively dominate the market. Migdal manages approximately 33% of total life-insurance and pension-fund assets in Israel, with a workforce of ~6,000 employees and a broad network of agents and pension advisers. The business is organised into four segments: Life Insurance, General Insurance, Health Insurance, and Long-term Savings (pension, provident, advanced-study funds) — the segment that has become the future core of the business. At year-end 2025, Migdal managed assets of NIS 583 billion — second place in Israel, close to The Phoenix. IFRS 17 adoption in 2025 changed the presentation of revenue and profit, complicating multi-year comparison. Market capitalisation stands at ~NIS 20B. The current CEO is Ronen Agassi, leading a strategic plan to 2028 (AUM target: NIS 750-850B, ROE 16-18%).
| Segment | Strategic Role | 2025 Performance |
|---|
| Long-term Savings | Future core of the business | Q4 profit: NIS 221M (+264% Y/Y) |
| Health Insurance | Growth engine — ageing demographics | Q4 profit: NIS 128M (+313% Y/Y) |
| Life Insurance | Stable, recurring | Long-duration policies |
| General Insurance | Operational | Auto, property, liability |
Source: 2025 Annual Report, maya.tase.co.il (security 1081165)
2 Key Financial Observations
This summary is not a recommendation. It is a factual list of key financial metrics.
AUM Competition 2025 (NIS B)
| Company | AUM | Rank |
|---|
| The Phoenix | ~585 | #1 |
| Migdal | ~583 | #2 |
| Clal Insurance | ~450 | #3 |
| Harel | ~400 | #4 |
| Menora Mivtachim | ~350 | #5 |
2028 Plan Targets (per company guidance)
| Metric | Target |
|---|
| Assets under management | NIS 750-850B |
| Annual comprehensive income | NIS 2.0-2.2B |
| ROE | 16-18% |
| Annual growth | ~10% |
| Industry rank | 1-2 |
Missing data: precise Solvency Ratio, detailed investment portfolio, multi-year comparison adjusted for IFRS 17.
AUM Competition 2025 (NIS B)
Q4 2025 Profit by Segment (NIS M)
Path to 2028 — AUM (NIS B)
Forward ROE Scenarios (%)
3 Industry & Competitive Context
Insurance & Financial Services — Israel. A concentrated market dominated by five players. The regulator is the Capital Markets, Insurance and Savings Authority, which sets capital requirements, solvency ratios, and product/fee constraints. A semi-cyclical sector — insurance activity is stable, but investment income is highly volatile.
| Macro Trend | Impact |
|---|
| Population ageing | Rising demand for health, long-term-care and pension products |
| Mandatory comprehensive pension | Steady inflow into pension funds |
| Positive capital markets | Boost AUM value and management fees |
| Tightening regulation | Barrier to entry, but also constrains profitability |
| Rising wages and employment | Increases pension and provident contributions |
4 Risk Factors
| Risk | Context |
|---|
| Capital-markets dependence | A material share of profit comes from investment income. A market downturn would compress reported profit. |
| Central-bank interest rate | Drives bond-portfolio yield (a meaningful share of investments) and the yield spread in life-insurance policies. |
| Regulation | The Capital Markets Authority can alter capital requirements, fee caps and product structures at any time. |
| Intense competition | Five dominant players — continuous pressure on management fees and commissions. |
| IFRS 17 transition | Adopted in 2025. Multi-year comparability is complex; profit transparency may temporarily diminish. |
| Actuarial risk | Gaps in longevity assumptions can erode long-term profit. |
| Portfolio credit risk | Part of the portfolio is corporate debt — a deterioration in credit conditions would affect valuations. |
| General-insurance losses | Catastrophic events (storms, earthquakes, conflict) can produce material losses. |
5 Analytical Lens — The Questions We Ask
In professional company analysis, the question is not "is this good?" but rather "through which lenses must this company be examined so that we do not miss what matters most?" At Bakshi Finance, every analysis passes through six lenses.
This framework is intended to structure analysis, not to produce an investment conclusion.
Growth
AUM grew 18.7% in 2025 (NIS 491B → NIS 583B). How much of that growth is market return (one-off) versus organic contribution inflows (stable)? What share would persist in a flat-market year? Is management’s 2028 target (NIS 750-850B) realistic or over-ambitious?
Profitability
ROE stands at 22% in 2025, with a 2028 target of 16-18%. Why does management expect ROE to decline — normalisation of investment income (temporary tailwind) or a structural shift? What is the "true" ROE once fair-value gains are neutralised?
Leverage
Insurance companies are net-leveraged by design (premiums collected against future payouts). What is Migdal’s Solvency Ratio? How does it compare to the regulatory floor (100%) and to peers? How does the interest-rate direction affect Solvency?
Competitive Position
Migdal ranks #2 in AUM, close to The Phoenix. What is the substantive difference between the two? Why has The Phoenix overtaken Migdal in recent years? How could Migdal retake the lead — through new products, digital, or acquisitions?
Management Quality
Ronen Agassi as CEO, leading the 2028 plan. To what extent are 2025’s results (ROE 22%, AUM +18.7%) management achievements versus the tailwind of a positive market? The announcement of a first dividend in years — how significant is that as a management signal?
Business Complexity / Risk
Migdal operates life, general, health and pension insurance — structurally different businesses. How should an investor value such a combination? Which segments contribute most to intrinsic value (NAV), and which contribute risk? What is the impact of IFRS 17 on transparency?
6 Scenario Framework
Scenarios are descriptive, not predictive. They outline possible conditions, not expected outcomes.
These scenarios carry no probability assessment, no preferred direction, and no expectation regarding which, if any, will materialise.
Constructive Scenario — if the following conditions hold:
Capital markets remain positive, AUM continues to grow at a 10-15% annual pace, Migdal executes the 2028 plan and reaches AUM targets (NIS 750-850B), ROE stabilises at 18-20%, and dividend policy establishes a routine distribution. Under these conditions, management-fee income expands, forward earnings improve, and the equity’s profile shifts toward an "income equity" suited to institutional investors.
Base Scenario — if current trends continue:
Capital markets are stable with customary volatility, AUM grows 7-10% annually (organic + market return), ROE normalises around 14-16% (down from the current 22%), and dividends settle at ~50% of net income. The 2028 plan is partially achieved.
Adverse Scenario — if the following risks materialise:
A capital-markets correction weighs on AUM and investment income (ROE falls below 10%), rising rates compress the bond portfolio, or new regulation reduces management fees. Under these conditions, profit contracts materially and the dividend may be suspended.
Scenarios describe conditions, not forecasts. There is no preferred direction and no probability assessment expressed in this framework.
7 How to Think About This Company
Migdal is not a conventional insurance company — over the past decade it has evolved more into an "asset manager" than a traditional "insurer". Most of its profit comes from management fees on NIS 583B in AUM — predominantly pension and provident assets — and less from classical underwriting (premiums minus claims). The real question in analysing Migdal is not "how much does it insure" but "how effectively does it manage its enormous AUM base, and how much of its profit is sustainable versus temporary?" That is an important distinction — large asset managers trade at different multiples than classical insurers.
The critical variables to monitor are three. First, AUM growth rate. The 18.7% growth in 2025 is exceptional — a combination of positive market returns, organic contributions, and net inflows. In a flat-market year, 6-8% growth would be an achievement; in a negative-market year, AUM can decline. Second, Solvency Ratio. This is the key regulatory metric that constrains the company. If it rises materially above the 100% floor, it frees cash flow for dividends. Third, progress against the 2028 plan. Management has published explicit numeric targets (AUM NIS 750-850B, ROE 16-18%, comprehensive income NIS 2.0-2.2B). Quarterly tracking against the cadence indicates whether the company is on track, behind, or ahead.
Where the analysis may go wrong. First error — treating ROE of 22% as a steady-state figure. The positive capital-markets environment of 2024-2025 drove strong returns in the investment portfolio, inflating reported profit. Normalisation (as management itself anticipates in its 2028 target of 16-18%) would reduce ROE by 25-30%. This is not a problem — it is simply the correct framing. Second error — ignoring the effect of IFRS 17. This new accounting standard altered the presentation of life-insurance revenues; comparisons with prior years (2021-2024) require adjustment, and the company does not always provide it. Third error — assuming that all large Israeli asset managers are alike. Migdal and The Phoenix differ substantively: The Phoenix is more aggressive in sales and marketing, while Migdal is more conservative.
What distinguishes professional analysis of Migdal from headlines. Headlines on Migdal speak of "record profit" or "record AUM". Professional analysis addresses three things: (a) the split between the contribution of a favourable market and the contribution of management execution — and how much of the 22% ROE is an achievement of management versus a gift of the market; (b) the sensitivity of profit to the Solvency Ratio — if it falls below a certain threshold, the dividend is frozen; (c) the normalisation scenario — how the company will look when ROE reverts to ~15%, and how much of the current multiple reflects temporary ROE versus structural ROE. These are not what one buys or sells — they are what one asks before deciding.
The difference between surface-level analysis and professional thinking often lies in the variables that are not immediately visible.
The difference between surface-level analysis and professional thinking often lies in the variables that are not immediately visible.
8 Sources & Data
| # | Source | Date | Type |
|---|
| 1 | Migdal — 2025 Annual Report | March 2026 | Official — TASE |
| 2 | maya.tase.co.il — security 1081165 | April 2026 | Official — Stock Exchange |
| 3 | migdal.co.il/ir — Investor Relations | Quarterly | Official — company website |
| 4 | Capital Markets Authority — supervisory reports | Annual | Official — Regulator |
| 5 | Calcalist / Bizportal / Globes | Ongoing | Secondary |
| 6 | stockanalysis.com — multiples | April 2026 | Secondary |
Missing: precise Solvency Ratio, detailed investment portfolio, multi-year comparison adjusted for IFRS 17.
