Elbit Systems stock climbed further above key moving averages on Tuesday following its Q1 earnings report. The Israel-based defense supplier last week announced two multimillion dollar contracts. Meanwhile, Israel is escalating its ground operations in Gaza.
Elbit Systems Earnings
Elbit Systems reported earnings of $2.35 per share, up 42% from $1.65 per share last year. Adjusted earnings came in at $2.57 per share.
Revenue jumped 22% to $1.89 billion, the third straight quarter of accelerating growth.
FactSet expected earnings of $2.15 per share on $1.69 billion in revenue
Aerospace revenue increased 20% to $504 million, outpacing FactSet views for 5% growth.
Land revenue jumped 48% to $560.8 million, driven by higher munition sales in Israel and Europe. Analysts expected $437 million in sales for the segment.
Revenue from Command, Control, Communications, Computers, Intelligence, Surveillance and Reconnaissance (C4ISR) systems rose to $220 million, while FactSet expected $213 million.
Intelligence, Surveillance, Target Acquisition and Reconnaissance (ISTAR) and Electronic Warfare (EW) sales rose 4% to $361 million, missing views for 11% growth.
Elbit Systems' backlog stood at $23.1 billion as of March 31. About 66% of the backlog is attributable to orders outside of Israel. The company noted that 51% of the backlog is scheduled to perform during 2025 and 2026.
Elbit also said that it has seen a "material increase" in demand from the Israel Ministry of Defense compared to demand levels prior to the war. That could generate additional orders. The contractor said that operations at its Israel facilities have been uninterrupted.
Meanwhile, about 3% of Elbit's employees were called up for reserve duty as of March 31. But that level could fluctuate as the war develops.
New Contracts Announced
Elbit Systems' America division on Thursday reported that it received a $112 million delivery order from the U.S. Marine Corps Systems Command for high-performance, helmet-mounted night vision goggles. The goggles will be produced at the company's facility in Roanoke, Virginia through December 2026. The delivery order was part of a multiyear indefinite delivery/indefinite quantity (ID/IQ) contract that Elbit secured in 2023, the company said.
That followed a May 13 announcement that Elbit received an $80 million contract from an international customer to upgrade reconnaissance helicopters. The two-year contract includes an upgrade package for Elbit's advanced avionics and intelligence, surveillance, target acquisition and reconnaissance (ISTAR) systems.
Elbit Systems Stock Rises
ESLT stock pared its Tuesday gains to 0.4% to close at 406.84. Elbit Systems on Monday rose 2.6% to climb above its 10-day moving average.
Shares last week rebounded above their 50-day line and 21-day exponential line following a 9% drop on Monday.
Elbit prior to the drop hit a record 426.40 on May 8, which also cleared a 420 entry for a consolidation. Technically, that buy point may no longer be valid, though investors could probably use that.
Elbit Systems has rallied more than 57% so far this year.
Meanwhile, Israel on Sunday launched an extensive ground invasion in northern and southern Gaza in an effort to secure the "release of the hostages and the defeat of Hamas," the IDF said in a statement reported by CNN. The ground operations followed a series of airstrikes over the week.
Hamas and Israel reportedly resumed ceasefire talks over the weekend and the U.S. is "actively engaged" in the negotiations, Secretary of State Marco Rubio told CBS's Face The Nation on Saturday. The two sides are negotiating for a two-month ceasefire, but there are conflicting objectives. Israel hopes to secure its hostages, the exile of Hamas militants and the disarmament of Gaza, which Hamas has so far refused, according to NPR sources. Meanwhile, Israel has refused to commit to a permanent end of the war, which is a key concession for Hamas.
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