Aerospace & Defense
Alembic are reiterating their Overweight rating on shares of ESLT and are raising their target price by USD4 to US265. ESLT shares have been weak YTD, particularly recently, due, Alembic believe, to political factors. One manifestation of such factors is France’s recent decision to bar Israeli firms from the upcoming Eurosatory defense conference. Despite such issues, they do not believe the fundamentals support a weakening in ESLT shares and believe there is meaningful upside from here. As such, Alembic reiterate their Overweight rating. Their 15.5x terminal valuation is ~5% premium to the S&P 500 on FY1 EV/EBITDA and Alembic believe there is likely room for valuation upside should ESLT’s focus on margin rate and cash flow begin to bear fruit.
Edition: 188
- 14 June, 2024