El Al Israel Airlines (TASE:ELAL) Posted Strong Q2 Results, Is The Stock Still Undervalued?
Why El Al Israel Airlines Stock Is Back in Focus After Q2 Results
El Al Israel Airlines (TASE:ELAL) is drawing fresh attention after releasing second quarter 2026 results, with higher quarterly sales, net income and earnings per share compared with the same period a year earlier.
See our latest analysis for El Al Israel Airlines.
El Al Israel Airlines’ latest earnings release has come alongside a 31.45% 90 day share price return and a very large 5 year total shareholder return, which signals that momentum has been building over both shorter and longer periods.
If you are looking for more ideas after El Al Israel Airlines’ recent move, this can be a good moment to see what else is setting the pace through the Simply Wall St screener for 102 top founder-led companies
After that sharp 90 day move and strong quarterly figures, the real issue for El Al Israel Airlines now is timing. Does buying after this run still make sense, or is patience for a cheaper entry wiser?
Preferred P/E of 10.6x for El Al Israel Airlines: Is it justified?
El Al Israel Airlines currently trades on a P/E of 10.6x, and based on Simply Wall St's checks this looks cheaper than both its industry group and peer set at the last close of ₪16.3.
The P/E multiple links the company’s share price to its earnings per share. For an airline like El Al Israel Airlines, it gives you a quick sense of how much investors are paying for each unit of current earnings, especially useful where earnings are positive and the business model is relatively capital intensive.
According to the Simply Wall St analysis, El Al Israel Airlines is viewed as good value at a P/E of 10.6x when compared with the Asian Airlines industry average of 12.6x and a peer average of 14.7x. That gap suggests the market is pricing its earnings at a discount to similar airlines, even though the company currently has high quality earnings and a Return on Equity of 27.8%, which is classified as high in this framework.
On these metrics the current earnings multiple points to a discounted valuation against both the wider industry and closer peers, which some investors may interpret as the market applying a lower price tag to the company’s earnings than it does elsewhere in the sector.
See what the numbers say about this price — find out in our valuation breakdown.
Result: Price-to-earnings of 10.6x (UNDERVALUED)
However, El Al Israel Airlines still faces sector wide risks, such as shifts in travel demand, fuel and operating costs, and potential pressure on its discounted valuation.
Find out about the key risks to this El Al Israel Airlines narrative.
Another View on El Al Israel Airlines Using the SWS DCF Model
The P/E ratio presents El Al Israel Airlines as cheaper than peers, and the SWS DCF model provides an additional perspective. At a share price of ₪16.3 and an estimated future cash flow value of ₪28.54, the stock appears undervalued by around 43%. That raises a simple question for investors: is the market being cautious or just slow to reprice this story?
Look into how the SWS DCF model arrives at its fair value.
Simply Wall St performs a discounted cash flow (DCF) on every stock in the world every day (check out El Al Israel Airlines for example). We show the entire calculation in full. You can track the result in your watchlist or portfolio and be alerted when this changes, or use our stock screener to discover 251 high quality undervalued stocks. If you save a screener we even alert you when new companies match - so you never miss a potential opportunity.
Next Steps
Given the mix of enthusiasm and caution around El Al Israel Airlines, the next move is yours. Move quickly to review the facts for yourself and weigh both sides of the story with the help of 1 key reward and 3 important warning signs
Looking For More Investment Ideas Beyond El Al Israel Airlines?
If El Al Israel Airlines has your attention, do not stop there. You might miss other opportunities if you ignore stocks with strong income, value or balance sheet profiles.
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- Hunt for potential value opportunities that combine quality and price through the 251 high quality undervalued stocks.
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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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