Boeing (BA) plans to supply an unnamed but valued customer with a fleet of F-15 fighter jets equipped with an anti-jamming system from Elbit Systems (ESLT). In addition to the customer’s identity, financial details of the deal also remain unknown.
Elbit stock fell 4.16% on Friday to close at $130.76. Boeing made its deal announcement on Sunday. (See Elbit stock chart on TipRanks).
Israel-based Elbit is a defense electronics specialist. It has developed a jamming immunity system that can handle a range of interfering signals to ensure uninterrupted GPS operation.
Its other technologies that have been adopted by fighter jets include large area cockpit displays, low-profile head up displays, and digital helmet mounted cueing systems.
Boeing’s director for international F-15 programs at Boeing, Lauren Gramlich, said that integrating Elbit’s system, “will meet the demanding operational requirements of this valued customer,” according to the report.
Boeing says the deal with Elbit shows its commitment to working with Israeli partners to advance the capabilities of fighter jets. (See Boeing stock chart on TipRanks)
Jefferies analyst Sheila Kahyaoglu reiterated a Buy rating on Boeing stock with a price target of $300. Kahyaoglu’s price target implies 26.40% upside potential. The analyst noted that Boeing’s USAF’s T-7A Red Hawk Advanced Trainer program is 15 months behind schedule.
“This has likely pushed out Milestone C to FYQ4 2023 and potentially introduced financial risk. However, there was some acknowledgement, with an initial charge of $400MM taken at the time of the win in 2018,” Kahyaoglu said. The analyst added that the T-7A was one of Boeing’s three major program wins.
Consensus among analysts is a Moderate Buy based on 8 Buys and 7 Holds. The Boeing average analyst price target of $272 implies 14.60% upside potential to current levels.
According to TipRanks’ Hedge Fund Trading Activity tool, confidence in BA is currently Neutral. The cumulative change in holdings across all 15 funds that were active in the last quarter was an increase of 23,300 shares.
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