Direct Finance (DIFI) AI Stock Analysis

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Direct Finance

(TASE:DIFI)

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Rating:55Neutral

Price Target:ILA 54,428.00▼(-2.18% Downside)

Action:reiterated

Date:08/24/26

The overall score of 55 reflects a balance of significant risks and attractive rewards. The primary concern is the company's high and increasing financial leverage, which poses a substantial risk. This is partially offset by a recent, dramatic improvement in cash flow generation. The stock's valuation is a key strength, with a low P/E ratio and a very high dividend yield that may appeal to income investors. Technical trends are neutral, providing no strong directional signal.

Positive Factors

Improving profitabilityStrong margins and higher net income indicate that the company is currently converting its business activity into earnings more effectively. If maintained, this profitability can support internal funding, strengthen resilience, and provide capacity to manage the balance sheet over the next several quarters.

Negative Factors

Very high leverageThe highly geared capital structure leaves relatively little room for operating or credit deterioration. If funding costs rise or credit conditions weaken, debt service and refinancing demands could absorb more cash, constrain investment, and reduce flexibility in managing future shocks.

Direct Finance (DIFI) vs. iShares MSCI Israel ETF (EIS)

Market Cap: ILS 1.68B
Dividend Yield: 8.57%
Average Volume (3M): 3,108
Price to Earnings (P/E): 7.9
Beta (1Y): 0.75
Revenue Growth: -1.75%
EPS Growth: 91.68%
Country: Israel
Employees: 655
Sector: General
Sector Strength: 55
Industry: Financial - Credit Services

Direct Finance Business Overview & Revenue Model

Company Description

Direct Finance of Direct Group (2006) Ltd is an Israeli financial services provider, offering a variety of financial solutions. Its product portfolio prominently features personal loans, including specific financing options for vehicles. Established...

Direct Finance Financial Statement Overview

Summary

Financial performance is mixed. The income statement shows declining profitability and stalled revenue growth (Score: 65). The balance sheet is a major concern due to high and rising leverage at 6.3x debt-to-equity (Score: 30). Cash flow has dramatically improved, turning positive in the TTM period (Score: 45). The overall picture balances improving liquidity against weakening profitability and high financial risk.

Income Statement

65Positive

Balance Sheet

30Negative

Cash Flow

45Neutral

Financial statement breakdown
Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	1.58B	1.53B	1.51B	1.38B	1.37B	853.30M
Gross Profit	942.15M	762.29M	688.46M	684.76M	725.82M	500.27M
EBITDA	559.45M	262.84M	279.15M	252.92M	425.80M	321.15M
Net Income	201.46M	120.06M	141.10M	132.47M	244.46M	181.32M
Balance Sheet
Total Assets	11.00B	10.37B	8.57B	7.83B	6.74B	4.26B
Cash, Cash Equivalents and Short-Term Investments	84.03M	11.44M	13.93M	12.58M	10.56M	80.20M
Total Debt	8.90B	8.39B	6.82B	6.24B	5.21B	3.04B
Total Liabilities	9.50B	8.95B	7.19B	6.56B	5.56B	3.31B
Stockholders Equity	1.42B	1.35B	1.32B	1.24B	1.18B	956.01M
Cash Flow
Free Cash Flow	367.62M	-260.64M	-622.12M	-928.26M	-1.10B	-1.53B
Operating Cash Flow	392.66M	-212.43M	-576.45M	-872.07M	-1.05B	-1.51B
Investing Cash Flow	-1.15B	-53.18M	-46.59M	-56.30M	-62.00M	-24.91M
Financing Cash Flow	825.89M	263.12M	624.39M	932.25M	1.04B	1.61B

Direct Finance Technical Analysis

Technical Analysis SentimentNegative

Last Price55640.00

Price Trends

50DMA61660.20Negative

100DMA60388.43Negative

200DMA56241.83Negative

Market Momentum

MACD-1890.80Negative

RSI42.91Neutral

STOCH69.01Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For IL:DIFI, the sentiment is Negative. The current price of 55640.00 is below the 20-day moving average (MA) of 56741.00, below the 50-day MA of 61660.20, and below the 200-day MA of 56241.83, indicating a bearish trend. The MACD of -1890.80 indicates Negative momentum. The RSI at 42.91 is Neutral, neither overbought nor oversold. The STOCH value of 69.01 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for IL:DIFI.

Direct Finance Peers Comparison

Overall Rating

UnderperformOutperform

Sector (55)

Financial Indicators

IL:DIFI against its peers
Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
IL:JCFN	74Outperform	ILS 685.90M	7.86	―	0.04%	20.00%	14.06%
IL:MCLL	69Neutral	ILS 708.16M	10.80	―	―	21.55%	14.68%
IL:NAWI	61Neutral	ILS 1.48B	6.15	―	3.82%	33.11%	48.58%
IL:ISCD	57Neutral	ILS 3.73B	16.14	-1.68%	―	7.18%	―
Sector *	55Neutral	$6.65B	3.83	-15.92%	6.20%	10.91%	7.18%
IL:DIFI	55Neutral	ILS 1.68B	7.89	―	8.57%	-1.75%	91.68%

* General Sector Average

Performance Comparison

IL:DIFI and its peers over the selected period
Ticker	Company Name	Price	Change	% Change
IL:DIFI	DIRECT FINANCE OF DIRECT GROUP (2006)LTD	55640.00	5075.61	10.04%
IL:ISCD	Isracard	1140.00	-264.00	-18.80%
IL:NAWI	Nawi Brothers Group Ltd	4500.00	-587.58	-11.55%
IL:MCLL	Michlol Finance Ltd	1416.00	60.00	4.42%
IL:JCFN	Jacob Finance & Investments Ltd.	2817.00	-608.07	-17.75%

Glossary

BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.

Date of analysis: Aug 24, 2026

Direct Finance AI Stock Analysis