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Eltek Ltd (ELTK)
NASDAQ:ELTK
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Eltek
(NASDAQ:ELTK)
70Outperform
Eltek (ELTK) vs. S&P 500 (SPY)
Market Cap
$55.53M
Dividend Yield2.66%
Average Volume (3M)11.19K
Price to Earnings (P/E)13.1
Beta (1Y)0.62
Revenue Growth-0.36%
EPS Growth-40.16%
CountryUS
Employees329
SectorTechnology
Sector Strength46
IndustryHardware, Equipment & Parts
Share Statistics
EPS (TTM)0.64
Shares Outstanding6,714,040
10 Day Avg. Volume5,012
30 Day Avg. Volume11,193
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)0.00
Price to Cash Flow (P/CF)N/A
P/FCF Ratio0.00
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusN/A
Number of Analyst Covering0
Eltek Business Overview & Revenue Model
Company DescriptionEltek (ELTK) is a leading manufacturer of high-performance and high-reliability printed circuit boards (PCBs), catering primarily to the defense, aerospace, medical, and industrial sectors. The company specializes in providing advanced technology solutions, offering a range of products that include rigid, flex-rigid, and multi-layer PCBs designed to meet stringent quality standards and customer-specific requirements.
How the Company Makes MoneyEltek generates revenue through the design, manufacturing, and sale of customized printed circuit boards. The company's key revenue streams include direct product sales to original equipment manufacturers (OEMs) and contract manufacturers, particularly within the defense, aerospace, medical, and industrial sectors. Eltek's emphasis on high-reliability and advanced technology PCBs allows it to command premium pricing. Additionally, the company benefits from long-term contracts and partnerships with key industry players, which provide a stable revenue base. Eltek's earnings are also supported by its ability to innovate and meet the evolving technological demands of its clients, maintaining competitive advantage and ensuring customer loyalty.
Eltek Financial Statement Overview
Summary
Eltek demonstrates strong financial health with robust profitability and a well-managed balance sheet. While stable margins and low leverage are strengths, the decline in revenue and negative Free Cash Flow indicate areas for improvement. Future focus should be on enhancing revenue growth while managing capital expenditures to improve Free Cash Flow.Income Statement
Eltek shows a stable profitability with a Gross Profit Margin of 22.2% and a Net Profit Margin of 9.1% for 2024. However, there's a decline in revenue from the previous year by 0.4%, which indicates a need for revenue growth strategies. EBIT and EBITDA margins remain healthy, reflecting efficient operations despite the slight revenue dip.75
Positive
Balance Sheet
The company's financial structure is strong, with a Debt-to-Equity Ratio of 0.15, indicating low leverage. A solid Return on Equity of 10.3% signifies effective use of equity capital. Furthermore, the Equity Ratio stands at 68.5%, showing a high proportion of assets financed by equity, enhancing financial stability.80
Positive
Cash Flow
Eltek's cash flow situation is mixed, with negative Free Cash Flow indicating high capital expenditures. The Operating Cash Flow to Net Income Ratio of 1.07 suggests efficient cash generation from operations, but the Free Cash Flow to Net Income Ratio is negative, highlighting the impact of significant investments on cash reserves.65
Positive
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 46.53M | 46.70M | 39.65M | 33.82M | 36.71M | Gross Profit |
| 10.34M | 13.10M | 8.27M | 6.90M | 7.74M | EBIT |
| 4.39M | 7.29M | 2.97M | 1.95M | 3.03M | EBITDA |
| 5.94M | 9.16M | 4.51M | 3.73M | 4.62M | Net Income Common Stockholders |
| 4.22M | 6.35M | 3.19M | 5.04M | 2.61M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 17.24M | 12.14M | 7.37M | 9.28M | 4.74M | Total Assets |
| 60.16M | 47.17M | 41.52M | 42.78M | 35.16M | Total Debt |
| 6.02M | 6.66M | 11.30M | 13.75M | 11.19M | Net Debt |
| -1.56M | -2.62M | 3.93M | 4.46M | 6.45M | Total Liabilities |
| 18.96M | 20.30M | 20.50M | 21.71M | 19.89M | Stockholders Equity |
| 41.19M | 26.87M | 21.02M | 21.07M | 15.27M |
| Cash Flow | Free Cash Flow | |||
| -4.97M | 6.43M | 802.00K | 2.34M | 2.17M | Operating Cash Flow |
| 4.54M | 8.86M | 3.83M | 3.88M | 3.25M | Investing Cash Flow |
| -15.87M | -2.96M | -3.03M | -1.65M | -1.14M | Financing Cash Flow |
| 9.61M | -3.81M | -1.64M | 2.12M | 814.00K |
Eltek Technical Analysis
Neutral
8.43
Price Trends
9.32
Negative
10.07
Negative
10.18
Negative
Market Momentum
-0.22
Negative
48.30
Neutral
58.65
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ELTK, the sentiment is Neutral. The current price of 8.43 is above the 20-day moving average (MA) of 8.18, below the 50-day MA of 9.32, and below the 200-day MA of 10.18, indicating a neutral trend. The MACD of -0.22 indicates Negative momentum. The RSI at 48.30 is Neutral, neither overbought nor oversold. The STOCH value of 58.65 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for ELTK.
Eltek Risk Analysis
Eltek disclosed 49 risk factors in its most recent earnings report. Eltek reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Eltek Peers Comparison
Overall Rating
UnderperformOutperform
Sector (59)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
72 Outperform | $43.35M | 11.97 | 19.54% | ― | 16.74% | ― | |
70 Outperform | $55.53M | 13.12 | 12.41% | 2.66% | -0.36% | -40.16% | |
59 Neutral | $9.97B | 10.09 | -6.54% | 3.08% | 7.41% | -11.60% | |
56 Neutral | $60.48M | 56.65 | 6.59% | ― | 8.40% | -18.22% | |
51 Neutral | $77.91M | ― | -30.42% | ― | -1.01% | -72.93% | |
49 Neutral | $57.07M | ― | -16.87% | ― | -16.22% | -297.70% | |
47 Neutral | $20.87M | 6.41 | -3.73% | ― | -8.04% | -118.60% |
* Technology Sector Average
Performance Comparison
ELTK
Eltek
8.43
-2.49
-22.80%
LPTH
Lightpath Technologies
2.00
0.59
41.84%
MIND
MIND Technology
6.88
2.78
67.80%
NSYS
Nortech Systems
8.20
-9.10
-52.60%
LINK
Interlink Electronics
5.80
-0.69
-10.63%
SOTK
Sono-Tek
3.96
-0.29
-6.82%
Eltek Earnings Call Summary
Earnings Call Date: Mar 11, 2025 | % Change Since: -20.92% | Next Earnings Date: May 15, 2025
Earnings Call Sentiment Negative
The earnings call reflected a challenging operational environment with significant constraints affecting revenue growth and profitability metrics. Despite these issues, Eltek maintained a strong cash position and identified positive market opportunities, especially in defense sectors. However, the lowlights, particularly operational challenges and financial metric declines, outweigh the highlights.Highlights
Solid Cash Position
The company maintained a solid cash position of approximately $17 million even after capital expenditure of approximately $10 million in 2024.
Net Profit Achievement
Eltek closed the year with a net profit of $4.2 million, indicating profitable operations despite challenges.
Positive Market Environment
Sustained high demand in defense, medical, and high-end industrial sectors, with opportunities arising from increased European defense budgets.
Successful Implementation of Growth Strategy
Significant emphasis on expanding commercial activities to increase sales volume and leverage high-end manufacturing capabilities.
Lowlights
Operational Challenges
Revenue growth constrained by operational challenges related to construction, installation of new equipment, and regional conflicts leading to delays from foreign technical experts.
Decrease in Financial Metrics
Gross profit decreased to $10.3 million from $13.1 million in 2023, and gross margin dropped from 28% to 22%. Operating profit also declined from $7.3 million in 2023 to $4.4 million in 2024.
Competition and Pricing Pressures
Increased competition from European companies in the Israeli market with aggressive pricing, though deemed unsustainable in the long term.
Unfavorable Product Mix
Shift in product mix and unfavorable orders impacted gross margins, with pressures expected to continue in the near term.
Labor Market Challenges
Continuous efforts to recruit employees amid a tough labor market in Israel, affecting manufacturing capacity and operational efficiency.
Company Guidance
During the Eltek Ltd. 2024 Annual and Fourth Quarter Financial Results Conference Call, the company provided detailed guidance on its financial performance and operational challenges. For the fiscal year 2024, Eltek reported revenues of $46.5 million, consistent with the previous year but below expectations, primarily due to operational challenges and regional conflicts. Despite these setbacks, the company achieved a net profit of $4.2 million, with a solid cash position of $17 million after a capital expenditure of approximately $10 million. Gross profit for the year reached $10.3 million, with a gross margin of 22%, down from 28% in 2023, mainly due to higher employee compensation costs and a shift in product mix. Operating profit stood at $4.4 million, and EBITDA was $5.9 million. The fourth quarter of 2024 saw revenues of $10.8 million and a net profit of zero, compared to $1.3 million in the same quarter of 2023. The company highlighted its focus on addressing operational challenges, such as the installation of new equipment and managing labor shortages, while emphasizing its strategic growth in defense, medical, and high-end industrial sectors. Looking ahead, Eltek anticipates similar capital investments in 2025 and aims for a gross margin in the range of 26% to 29% over the next two to three years.Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
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.