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Elbit Systems
(TASE:ESLT)
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Rating:71Outperform
Price Target:
223,321
▲(4.36% Upside)
Action:Reiterated
Date:08/19/26
The score is driven primarily by strong financial performance and a very positive earnings update (mid-teens growth outlook, record backlog, margin/EPS expansion, and strong cash generation). Offsetting these positives are an expensive valuation (high P/E and low yield) and weaker near-term technical momentum (below key moving averages with negative MACD).
Positive Factors
Record backlog and international demand
The record backlog provides substantial multi-year revenue visibility and supports production planning beyond a single procurement cycle. Its strong international mix broadens customer exposure, reduces reliance on Israel alone, and indicates sustained demand for Elbit’s defense technologies.
Negative Factors
Higher effective tax burden
The OECD Pillar II implementation has materially increased Elbit’s effective tax rate, reducing the portion of operating profit that reaches shareholders. Unless offset by growth or efficiencies, the higher structural tax burden could constrain net-margin expansion and moderate future EPS conversion.
Read all positive and negative factors
Positive Factors
Negative Factors
Record backlog and international demand
The record backlog provides substantial multi-year revenue visibility and supports production planning beyond a single procurement cycle. Its strong international mix broadens customer exposure, reduces reliance on Israel alone, and indicates sustained demand for Elbit’s defense technologies.
Read all positive factors
Elbit Systems (ESLT) vs. iShares MSCI Israel ETF (EIS)
Market Cap
₪94.72B
Dividend Yield0.56%
Average Volume (3M)55.82K
Price to Earnings (P/E)47.9
Beta (1Y)0.83
Revenue Growth-1.42%
EPS Growth32.43%
CountryIL
Employees21,000
SectorGeneral
Sector StrengthN/A
IndustryAerospace & Defense
Share Statistics
EPS (TTM)13.79
Shares Outstanding46,866,390
10 Day Avg. Volume60,523
30 Day Avg. Volume55,824
Financial Highlights & Ratios
PEG Ratio0.61
Price to Book (P/B)6.38
Price to Sales (P/S)3.32
P/FCF Ratio44.01
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
₪266,521.25Price Target Upside24.55% Upside
Rating ConsensusHold
Number of Analyst Covering4
EPS Forecast (FY)14.76
Revenue Forecast (FY)₪9.11B
Elbit Systems Business Overview & Revenue Model
Company Description
Established in Haifa, Israel, in 1966, Elbit Systems Ltd. is a leading provider of comprehensive defense, homeland security, and commercial aviation solutions. The company designs and manufactures an extensive portfolio of advanced systems tailore...
How the Company Makes Money
Elbit Systems primarily makes money by designing, manufacturing, integrating, and sustaining defense and security systems sold under multi-year contracts to government defense ministries, armed forces, and other security agencies (and, in some cas...
Elbit Systems Earnings Call Summary
Earnings Call Date:Aug 11, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Nov 24, 2026
Earnings Call Sentiment Positive
The call presents a clearly positive operational and financial picture: double-digit revenue growth, record $32B backlog (driven by international demand), expanding margins, strong EPS growth, robust cash generation and multiple sizable contract awards and strategic M&A. Key negatives are an isolated aerospace revenue decline, a materially higher effective tax rate due to OECD Pillar II, some revenue concentration in Israel from inventory replenishment, and conversion/capacity execution risks tied to turning a large backlog into near-term revenue. Overall, the positives (broad-based growth, margin expansion, cash strength and major contract awards) materially outweigh the lowlights.Positive Updates
Double-Digit Revenue Growth
Revenues increased 15.9% year-over-year to $2,287 million in Q2 2026 (from $1,973 million), with sequential revenue growth continuing and strong contributions from Europe (25%), North America (20%), Asia-Pacific (14%) and Israel (37%).
Negative Updates
Aerospace Segment Weakness
Aerospace revenues decreased 8% year-over-year in Q2 2026, driven by a one-time unfavorable project mix and lower training & simulation sales in Europe (partially offset by UAV growth in Israel).
Read all updates
Q2-2026 Updates
Positive
Negative
Double-Digit Revenue Growth
Revenues increased 15.9% year-over-year to $2,287 million in Q2 2026 (from $1,973 million), with sequential revenue growth continuing and strong contributions from Europe (25%), North America (20%), Asia-Pacific (14%) and Israel (37%).
Read all positive updates
Company Guidance
Management reiterated guidance for continued mid‑teens revenue growth and strong backlog conversion, pointing to Q2 revenues of $2,287m (+15.9% YoY) and a record backlog of $32.0bn (≈34% YoY increase, ≈6% sequential), ~70% of backlog generated outside Israel and ~42% scheduled to be performed in 2026–27; they said revenue growth has been ~14% in 2024, ~15% in 2025 and expect mid‑teens again in 2026. They raised planned CapEx from $220m to $300m (H1 CapEx > $150m) and increased R&D by about $70m in H1 (≈half funded by Israel’s new R&D law), while maintaining margin expansion (GAAP gross margin 25.3% / non‑GAAP 25.6%; GAAP operating income $218.8m or 9.6% of revenues / non‑GAAP $237.5m or 10.4%) and EPS growth (GAAP diluted EPS $3.61, +34% YoY; non‑GAAP diluted EPS $4.14, +28% YoY). They also highlighted strong cash generation (operating cash flow $237m vs. $120m a year ago; free cash flow $150m vs. $71m; cash conversion 86%), a lower financial expense ($22m vs. $31.2m), and a higher effective tax rate (16.4% in Q2‑2026 vs. 5.6% in Q2‑2025 due to OECD Pillar II), and noted growing customer‑funded CapEx and capacity investments aimed at accelerating backlog conversion.Elbit Systems Financial Statement Overview
Summary
Income Statement
78
Positive
Balance Sheet
83
Very Positive
Cash Flow
75
Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 8.62B | 7.94B | 6.83B | 5.97B | 5.51B | 5.28B |
| Gross Profit | 2.16B | 1.94B | 1.64B | 1.48B | 1.37B | 1.36B |
| EBITDA | 934.48M | 804.92M | 632.80M | 488.62M | 492.78M | 559.88M |
| Net Income | 641.39M | 578.41M | 321.14M | 215.13M | 275.45M | 274.35M |
Balance Sheet | ||||||
| Total Assets | 13.86B | 12.66B | 10.97B | 9.74B | 9.22B | 9.32B |
| Cash, Cash Equivalents and Short-Term Investments | 962.93M | 815.91M | 266.68M | 207.95M | 212.15M | 260.18M |
| Total Debt | 852.24M | 965.01M | 1.37B | 1.47B | 1.29B | 1.45B |
| Total Liabilities | 9.45B | 8.53B | 7.69B | 6.79B | 6.46B | 6.77B |
| Stockholders Equity | 4.41B | 4.13B | 3.28B | 2.95B | 2.76B | 2.53B |
Cash Flow | ||||||
| Free Cash Flow | 692.77M | 598.40M | 319.56M | -73.33M | 34.96M | 228.31M |
| Operating Cash Flow | 1.01B | 842.57M | 534.61M | 113.71M | 240.07M | 416.93M |
| Investing Cash Flow | -229.83M | -422.94M | -178.83M | -210.60M | -151.98M | -587.72M |
| Financing Cash Flow | -589.53M | -19.35M | -287.85M | 83.21M | -135.97M | 150.99M |
Elbit Systems Technical Analysis
Negative
213990.00
Price Trends
225355.80
Negative
230272.95
Negative
232426.16
Negative
Market Momentum
-5226.99
Positive
37.71
Neutral
6.95
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For IL:ESLT, the sentiment is Negative. The current price of 213990 is below the 20-day moving average (MA) of 216208.50, below the 50-day MA of 225355.80, and below the 200-day MA of 232426.16, indicating a bearish trend. The MACD of -5226.99 indicates Positive momentum. The RSI at 37.71 is Neutral, neither overbought nor oversold. The STOCH value of 6.95 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for IL:ESLT.
Elbit Systems Peers Comparison
UnderperformOutperform
Sector (55)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
71 Outperform | ₪94.72B | 47.85 | 14.04% | 0.56% | -1.42% | 32.43% | |
63 Neutral | ₪6.63B | 38.51 | ― | 20.70% | 4.82% | 18.75% | |
62 Neutral | ₪1.51B | 22.73 | ― | 2.88% | 4.35% | 20.22% | |
55 Neutral | $6.65B | 3.83 | -15.92% | 6.20% | 10.91% | 7.18% | |
45 Neutral | ₪2.37B | 57.71 | ― | 0.41% | 14.35% | -14.54% |
* General Sector Average
IL:ESLT
Elbit Systems
202,440.00
31,200.32
18.22%
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IL:ISHI
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IL:ISI
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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.