Elbit stock plummets after big Q3 miss
Shares of Elbit Systems (ESLT) (TASE:ESLT) listed in the U.S. tanked as much as 10.5% on Tuesday after the Israeli defence company’s third quarter results missed consensus widely.
ESLT posted Q3 Non-GAAP EPS of $1.40, off by 71 cents, and revenue of $1.3 billion came short of average analyst estimates by $60 million.
The Haifa-based company said its third-quarter net income was hit by expenses of about $20 million from stock price linked compensation plans to retain its employees.
Elbit's board also declared a dividend of $0.50 per share for Q3, which will be paid on January 9.
"The current environment presents opportunities and challenges for Elbit Systems. Elevated geopolitical tensions and growing defense budgets have created multiple opportunities and we are increasing investment in business development to realize the potential from these trends,” President and CEO Bezhalel Machlis said in a statement.
Machlis added that he assumes supply chain and labour inflation pressures to gradually subside from the second half next year.
Elbit’s order backlog as of September 30, 2022 was $14.7 billion and about 75% of backlog is from outside Israel.
The company said it expects about 40% of the backlog to be fulfilled in the remainder of 2022 and 2023.
If session losses hold, ESLT shares listed on the Nasdaq are expected to lose all year-to-date gains.