Elco (ELCO) AI Stock Analysis

• Market Cap: 4.74B
• Dividend Yield: 4.04%
• Average Volume (3M): 20.60K
• Price to Earnings (P/E): 76.4
• Beta (1Y): 1.90
• Revenue Growth: 11.99%
• EPS Growth: N/A
• Country: IL
• Employees: 23,850
• Sector: Services
• Sector Strength: N/A
• Industry: Conglomerates
• EPS (TTM): 148.50
• Shares Outstanding: 26,929,747
• 10 Day Avg. Volume: 24,920
• 30 Day Avg. Volume: 20,596
• PEG Ratio: 0.58
• Price to Book (P/B): 1.91
• Price to Sales (P/S): 0.20
• P/FCF Ratio: 182.84
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: Hold
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 56 Neutral
• Price Target: 17,531.00 ▼(-0.39% Downside)

Elco's overall stock score is primarily influenced by its financial performance and technical analysis. Despite strong revenue growth, high leverage and profitability issues weigh down the score. Technical indicators suggest potential bearish momentum. The high P/E ratio raises valuation concerns, although the dividend yield offers some compensation.

Positive Factors

Revenue Growth

Consistent revenue growth indicates strong demand for Elco's products and services, enhancing its market position and potential for future expansion.

Cash Flow Management

Improved cash generation from operations suggests effective financial management, providing resources for investment and debt servicing.

Operational Efficiency

Enhanced operational efficiency reflects Elco's ability to manage costs and optimize operations, potentially leading to improved profitability.

Negative Factors

High Leverage

Significant leverage can limit financial flexibility and increase risk, particularly in economic downturns, impacting long-term stability.

Profitability Challenges

Ongoing profitability issues may hinder Elco's ability to reinvest in growth and innovation, affecting its competitive position.

Low Equity Ratio

A low equity ratio suggests limited financial buffer, which can affect the company's ability to withstand financial stress and invest in growth.

Elco Business Overview & Revenue Model

Company Description

Elco Ltd. operates in the construction, infrastructure, consumer electronics, telecommunications, entertainment, and real estate sectors in Israel. The company is involved in the development, construction, operation, management, and maintenance of various projects; import, marketing, and sale of air conditioning and electronic home appliances; operation and management of multi-family properties; and content and distribution, leisure, and cinema businesses. It also markets, supplies, and distributes LPG, natural gas, and CNG to private households, as well as industrial, commercial, and transportation sectors. Elco Ltd. was incorporated in 1949 and is based in Tel Aviv-Yafo, Israel. Elco Ltd. is a subsidiary of G. Salkind Ltd.

How the Company Makes Money

Elco makes money primarily through the sale of its electronic components and systems to various industries. The company generates revenue by manufacturing and distributing products such as semiconductors, circuit boards, and other electronic components. Key revenue streams include direct sales to manufacturers in the automotive and telecommunications industries, as well as partnerships with consumer electronics companies. Elco may also engage in licensing agreements and collaborations with other technology firms to expand its product offerings and market reach, contributing to its overall earnings.

Elco Financial Statement Overview

Summary

Elco demonstrates solid revenue growth but faces profitability challenges due to recurring net losses. The balance sheet shows high leverage, impacting financial flexibility. However, cash flow management has improved, with increased operating cash flow and positive free cash flow.

Income Statement

Elco's revenue has shown a consistent upward trend, with a notable growth rate of 10.2% from 2023 to 2024. However, the company has faced profitability challenges, as indicated by negative net income in recent years. The gross profit margin stands at 15.1% for 2024, reflecting moderate efficiency in cost management. EBIT and EBITDA margins have improved, suggesting better operational efficiency, but the net profit margin remains negative due to high expenses or other financial burdens.

Balance Sheet

Elco's balance sheet reveals a high debt-to-equity ratio of 5.88, indicating significant leverage which could pose financial risks. The equity ratio is relatively low at 8.1%, reflecting limited shareholder equity in proportion to total assets. Return on equity has been negative due to net losses, highlighting profitability concerns. Despite these challenges, the company has maintained a stable asset base, which is crucial for long-term growth.

Cash Flow

Elco's cash flow statement shows a positive trend in operating cash flow, increasing from $437 million in 2023 to $938 million in 2024, indicating improved cash generation from core operations. Free cash flow has turned positive in 2024, a significant improvement from previous years. The operating cash flow to net income ratio is strong, suggesting effective cash management despite net losses. However, the company should continue to focus on sustaining free cash flow growth to support financial stability.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	22.17B	20.61B	18.70B	18.70B	14.82B	10.97B
Gross Profit	3.27B	3.11B	2.73B	3.57B	2.70B	1.58B
EBITDA	1.83B	1.35B	1.01B	2.35B	1.98B	976.07M
Net Income	61.85M	-118.00M	-289.00M	429.54M	544.62M	284.05M
Balance Sheet
Total Assets	27.17B	26.05B	23.98B	22.85B	19.04B	11.67B
Cash, Cash Equivalents and Short-Term Investments	1.68B	1.80B	1.15B	1.33B	1.13B	1.40B
Total Debt	12.98B	12.38B	10.45B	9.34B	7.93B	3.57B
Total Liabilities	21.90B	20.93B	18.99B	17.40B	14.67B	8.65B
Stockholders Equity	2.19B	2.11B	2.25B	2.58B	2.06B	1.60B
Cash Flow
Free Cash Flow	-100.75M	22.00M	-561.91M	-234.67M	-610.50M	574.08M
Operating Cash Flow	933.67M	938.00M	437.48M	330.75M	-144.70M	916.10M
Investing Cash Flow	-1.01B	-1.32B	-1.24B	-945.40M	-1.24B	143.97M
Financing Cash Flow	74.47M	1.00B	624.80M	893.99M	1.12B	-578.17M

Elco Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 17600.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For IL:ELCO, the sentiment is Positive. The current price of 17600 is above the 20-day moving average (MA) of 16741.50, above the 50-day MA of 17102.00, and above the 200-day MA of 16972.35, indicating a bullish trend. The MACD of 166.53 indicates Negative momentum. The RSI at 60.86 is Neutral, neither overbought nor oversold. The STOCH value of 84.37 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for IL:ELCO.

Elco Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
TRPZ	70 Outperform	7.01B	106.28	―	0.46%	44.88%	21.45%
YHNF	66 Neutral	4.91B	26.11	―	2.33%	7.38%	-7.10%
BSEN	65 Neutral	6.39B	46.46	―	―	14.00%	20.33%
ISHI	62 Neutral	3.80B	79.09	―	0.57%	10.92%	-24.52%
ISCN	58 Neutral	5.54B	113.03	―	0.45%	48.74%	-82.72%
ELCO	56 Neutral	4.74B	76.45	―	4.04%	11.99%	―
Sector *	55 Neutral	$13.29B	17.42	10.03%	0.93%	7.13%	-12.93%