Gilat (GILT) AI Stock Analysis

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Gilat

(NASDAQ:GILT)

Rating:69Neutral

Price Target:

$8.50

▲(15.18%Upside)

Gilat's overall stock score is driven by strong technical analysis and financial performance, despite valuation concerns and mixed earnings call insights. The company's growth strategy and market positioning are promising, but profitability and margin challenges need addressing to sustain investor confidence.

Positive Factors

Defense Sector Opportunities

Management is optimistic that Gilat will be a beneficiary of the expected surge in European defense spending, positioning the company to capture a share of increased defense spend.

Growth in Aerospace Partnerships

Stellar Blu’s line-fit partnership with Boeing for B737 MAX and B787 Dreamliner aircraft positions the company to capture significant new business.

Strategic Acquisitions

The acquisition of Stellar Blu positions Gilat to capture a significant portion of the LEO aviation antenna market.

Negative Factors

Revenue Challenges

1Q results were below consensus as Stellar Blu ramps products and its Peru segment was impacted by government delays.

Revenue Shortfalls

Total revenue was 6% below consensus expectations.

Supply Chain Constraints

There are some modest supply chain constraints for SBS that would make its second half performance stronger than the first half.

Gilat (GILT) vs. SPDR S&P 500 ETF (SPY)

Market Cap

$420.79M

Dividend YieldN/A

Average Volume (3M)449.99K

Price to Earnings (P/E)31.1

Beta (1Y)1.07

Revenue Growth13.49%

EPS Growth-39.61%

CountryUS

Employees1,118

SectorTechnology

Sector Strength91

IndustryCommunication Equipment

Share Statistics

EPS (TTM)0.03

Shares Outstanding57,017,033

10 Day Avg. Volume426,994

30 Day Avg. Volume449,993

Financial Highlights & Ratios

PEG Ratio-0.69

Price to Book (P/B)1.45

Price to Sales (P/S)0.00

P/FCF Ratio32.20

Enterprise Value/Market Cap1.03

Enterprise Value/Revenue0.36

Enterprise Value/Gross Profit3.83

Enterprise Value/Ebitda2.98

Forecast

1Y Price Target

$8.50

Price Target Upside15.18% Upside

Rating ConsensusModerate Buy

Number of Analyst Covering2

Gilat Business Overview & Revenue Model

Company DescriptionGilat Satellite Networks Ltd. (GILT) is a leading global provider of satellite-based broadband communications. The company specializes in the design, manufacture, and deployment of advanced satellite networking technology and services. Gilat operates in various sectors, including broadband Internet connectivity, in-flight connectivity, cellular backhaul, and defense and public safety. It offers a comprehensive range of products and services, including VSAT (Very Small Aperture Terminal) networks, satellite modems, and related network management software.

How the Company Makes MoneyGilat generates revenue primarily through the sale of its satellite communication products and services. The company earns money by providing VSAT equipment and network management solutions to telecommunications companies, Internet service providers, and government entities. Additionally, Gilat offers managed services, where it operates and maintains satellite networks for its clients, leading to recurring revenue streams. Significant partnerships with satellite operators and service providers further enhance its market reach and revenue potential. The company's earnings are also bolstered by contracts with defense and government agencies for secure communication solutions.

Gilat Earnings Call Summary

Earnings Call Date:May 19, 2025

(Q1-2025)

% Change Since: 10.48%|

Next Earnings Date:Aug 12, 2025

Earnings Call Sentiment Neutral

The earnings call presented a mixed picture. While there was significant year-over-year revenue growth and promising developments in the Defense and Commercial segments, these were offset by challenges in the Peru segment, a decrease in gross margin, and a reported net loss. The acquisition of Stellar Blu shows potential, but its impact on margins and the net loss are concerns.

Q1-2025 Updates

Positive Updates

Record Revenue Growth

Q1 2025 revenues reached $92 million, a 21% increase year-over-year, driven by the acquisition of Stellar Blu and strong demand in the Defense segment.

Stellar Blu Acquisition Impact

Stellar Blu contributed $25 million to the top line, with expectations for annual revenue between $120 million and $150 million.

Defense Segment Expansion

Gilat Defense was awarded over $5 million for US DoD and international projects, with additional contracts totaling $44 million for various defense-related technologies and services.

Commercial Aviation Advances

Intelsat installed the Sidewinder ESA on over 150 aircraft, achieving 70,000 flight hours. Panasonic certified the Sidewinder ESA, boosting market validation.

Negative Updates

Peru Segment Revenue Decline

Revenue for the Peru segment decreased to $4.8 million from $17.7 million in Q1 2024 due to project delays and slower progress in existing projects.

Decrease in Gross Margin

GAAP gross margin decreased to 30.9% from 36.9% year-over-year, primarily due to lower margins in Stellar Blu and Peru.

GAAP Operating Loss

The company reported a GAAP operating loss of $2.7 million compared to a GAAP operating income of $5.4 million in Q1 2024.

Net Loss in Q1

Gilat reported a GAAP net loss of $6 million or a loss per share of $0.10 compared to a GAAP net income of $5 million or $0.09 per share in Q1 2024.

Company Guidance

During the first quarter of 2025, Gilat reported revenues of $92 million, marking a 21% increase year-over-year. The adjusted EBITDA for the quarter was $7.6 million, with Stellar Blu, a recent acquisition, contributing approximately $25 million to the top line but incurring an adjusted EBITDA loss of around $3.6 million. Excluding this loss, the adjusted EBITDA was $11.2 million, a 20% year-over-year increase. Stellar Blu is expected to generate between $120 million and $150 million in revenue for the year and to reach a 10% adjusted EBITDA margin run rate in the second half. The company is strategically positioned for growth, with strong demand in its Defense and Commercial segments, reinforced by a healthy backlog covering nearly 80% of its annual revenue guidance of $415 million to $455 million.

Gilat Financial Statement Overview

Summary

Gilat demonstrates strong financial performance with solid revenue growth, profitability, and cash flow management. The low debt-to-equity ratio indicates financial stability, and the company maintains a robust equity position. However, the net profit margin and return on equity could be improved further.

Income Statement

Positive

Gilat shows a strong revenue growth rate of 14.79% from 2023 to 2024, indicating expanding operations. The gross profit margin stands at 37.09%, and the net profit margin is 8.13%, which are solid figures for the industry, reflecting efficient cost management and profitability. EBIT and EBITDA margins are also healthy at 9.07% and 14.16%, respectively, showcasing operational efficiency and strong earnings before interest and taxes.

Balance Sheet

Positive

The company's balance sheet is robust with a low debt-to-equity ratio of 0.03, indicating low leverage and financial stability. The return on equity (ROE) is 8.16%, reflecting reasonable profitability relative to shareholder equity. The equity ratio is 70.85%, highlighting a strong equity base and reduced financial risk. Overall, the company is in a stable financial position with solid asset management.

Cash Flow

Positive

Gilat's free cash flow growth rate is 18.23% from 2023 to 2024, suggesting improved cash generation capability. The operating cash flow to net income ratio is 1.27, indicating that the company generates sufficient operating cash flow to cover its net income. The free cash flow to net income ratio is 1.01, showing that the company effectively converts its net income into free cash flow. Overall, the cash flow statements reflect a positive cash position and efficient cash management.

Breakdown	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	305.45M	266.09M	239.84M	218.82M	165.88M
Gross Profit	113.33M	104.94M	86.91M	71.62M	41.22M
EBITDA	43.26M	41.83M	22.33M	13.82M	-5.57M
Net Income	24.85M	23.50M	-5.93M	-2.68M	35.08M
Balance Sheet
Total Assets	429.75M	426.89M	385.41M	352.99M	393.81M
Cash, Cash Equivalents and Short-Term Investments	119.38M	103.96M	86.59M	84.02M	88.75M
Total Debt	8.57M	14.90M	3.83M	4.10M	8.90M
Total Liabilities	125.31M	152.20M	141.29M	120.90M	160.00M
Stockholders Equity	304.44M	274.69M	244.13M	232.09M	233.81M
Cash Flow
Free Cash Flow	25.06M	21.20M	-1.98M	9.97M	38.44M
Operating Cash Flow	31.67M	31.94M	10.81M	18.90M	43.16M
Investing Cash Flow	-6.61M	-12.69M	-8.16M	-11.09M	-4.72M
Financing Cash Flow	-8.11M	-1.59M	0.00	-39.00M	-24.09M

Gilat Technical Analysis

Technical Analysis Sentiment

Positive

Last Price7.38

Price Trends

50DMA

6.50

Positive

100DMA

6.55

Positive

200DMA

6.23

Positive

Market Momentum

MACD

0.33

Negative

RSI

67.23

Neutral

STOCH

48.59

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GILT, the sentiment is Positive. The current price of 7.38 is above the 20-day moving average (MA) of 7.03, above the 50-day MA of 6.50, and above the 200-day MA of 6.23, indicating a bullish trend. The MACD of 0.33 indicates Negative momentum. The RSI at 67.23 is Neutral, neither overbought nor oversold. The STOCH value of 48.59 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for GILT.

Gilat Risk Analysis

Gilat disclosed 60 risk factors in its most recent earnings report. Gilat 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

Gilat Peers Comparison

Overall Rating

UnderperformOutperform

Sector (63)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
AVNW	73 Outperform	$298.77M	―	-1.32%	―	12.39%	-123.62%
CRNT	72 Outperform	$215.88M	9.20	15.02%	―	11.94%	377.86%
GILT	69 Neutral	$420.79M	31.12	4.79%	―	13.49%	-39.61%
AUDC	63 Neutral	$270.98M	16.20	9.33%	3.94%	-1.13%	61.49%
Sector *	63 Neutral	$33.80B	5.84	-11.67%	1.84%	5.28%	-18.34%
CLFD	59 Neutral	$574.81M	―	-0.68%	―	-2.14%	44.13%

* Technology Sector Average

Performance Comparison

GILT

Gilat

7.58

2.84

59.92%

AUDC

Audiocodes

8.96

-1.92

-17.65%

AVNW

Aviat Networks

23.56

-6.72

-22.19%

CRNT

Ceragon Networks

2.36

-0.34

-12.59%

CLFD

Clearfield

41.34

-0.83

-1.97%

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.Date of analysis: Jul 10, 2025