Yohananof (TASE:YHNF) Profit Growth Outpaces Five-Year Average, Reinforcing Resilient Retail Narrative

M.Yochananof and Sons (1988) (TASE:YHNF) has just released Q2 2025 results, reporting revenue of ₪1.26 billion and basic EPS of ₪3.75. Looking at the bigger picture, the company has seen revenue rise from ₪1.14 billion in Q2 2024 to ₪1.26 billion in the latest quarter, with EPS moving from ₪4.27 to ₪3.75 over the same period. Net profit margins have broadly held steady, setting up a results season focused on the earnings mix and margin sustainability.

See our full analysis for M.Yochananof and Sons (1988).

Next up, we are setting these headline numbers against the dominant narratives in the market to see what is in sync, and where expectations might get shaken up.

Curious how numbers become stories that shape markets? Explore Community Narratives

Profit Growth Outpaces Five-Year Trend

• Trailing twelve-month net income reached ₪200.1 million, representing 13.2% growth versus the prior year, compared to a five-year annual growth average of 5.6%.
• Industry narrative highlights Yohananof's role as an essential goods provider, supported by brand recognition and product diversification.
  • Trailing twelve-month revenue rose to ₪4.79 billion, underlining the advantage of staples retailing during economic fluctuations.
  • A 4.2% net profit margin remains stable, indicating margin durability that aligns with the view of resilient food retail operators.

Valuation Premium Widens Versus Peers

• The current price-to-earnings ratio is 20.8x, exceeding both the Asian Consumer Retailing average of 16.7x and peer group average of 18.2x.
• Consensus narrative notes the share price of ₪287.20 is sharply above the DCF fair value of ₪105.02, spotlighting investor willingness to pay a premium:
  • Sustained earnings quality may partly justify the premium, but the 20.8x multiple places pressure on future growth delivery.
  • Overvaluation relative to intrinsic value might make new buyers cautious unless further upside surprises materialize.
  
  Bulls and skeptics can see why this valuation gap is drawing notice. Catch the full consensus narrative for deeper context. 📊 Read the full M.Yochananof and Sons (1988) Consensus Narrative.

Margin Improvement Steadies Profitability

• Net profit margin improved to 4.2% over twelve months, up slightly from 4.1% a year ago, reflecting stable operational efficiency amid industry shifts.
• The prevailing market view is that this moderate margin lift, combined with accelerating earnings growth, demonstrates management’s ability to defend and grow profitability despite higher input costs:
  • Analysts regard earnings as "high quality" for the period, suggesting these margins are being sustained without major one-off impacts.
  • Outpacing the company’s five-year growth average shows flexibility in adapting to the sector’s pressures.

Next Steps

Don't just look at this quarter; the real story is in the long-term trend. We've done an in-depth analysis on M.Yochananof and Sons (1988)'s growth and its valuation to see if today's price is a bargain. Add the company to your watchlist or portfolio now so you don't miss the next big move.

See What Else Is Out There

Despite recent profit gains, Yohananof’s steep valuation premium over intrinsic value could limit upside and increase downside risk for new investors.

If overpaying worries you, use these 920 undervalued stocks based on cash flows to search for attractively priced companies with better value and greater margin for future growth.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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