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Tat Technologies Ltd (TATT)
NASDAQ:TATT
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Tat Techno
(NASDAQ:TATT)
Rating:75Outperform
Price Target:
$45.00
▲(33.06% Upside)
Positive Factors
Market Position
TATT is viewed as a small cap commercial aero aftermarket component repair player poised to drive above market growth through share gains and an improved go-to-market strategy.
Revenue Growth
TAT Technologies' consistent revenue growth combined with backlog expansion provides visibility of over 20% revenue growth, showcasing its strong market position.
Strategic Partnerships
TAT's expanded relationship with Honeywell since 2020/2021 has transformed the business, offering considerable growth opportunities as the sole domestic independent MRO service provider authorized by Honeywell.
Negative Factors
Downside Risks
Downside risks include loss of U.S. and Israeli Government contracts and approvals, supply chain disruptions, increasing labor and raw material costs, and geopolitical conflicts in Israel.
Market Share
The biggest upside potential lies in the APU MRO services for 777, 737, and A320, where TATT currently has no market share, and significant growth is anticipated.
Tat Techno (TATT) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$446.29M
Dividend YieldN/A
Average Volume (3M)187.73K
Price to Earnings (P/E)28.2
Beta (1Y)0.86
Revenue Growth25.96%
EPS Growth68.93%
CountryUS
Employees634
SectorIndustrials
Sector Strength74
IndustryAerospace & Defense
Share Statistics
EPS (TTM)0.30
Shares Outstanding12,887,289
10 Day Avg. Volume135,139
30 Day Avg. Volume187,731
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)0.00
Price to Sales (P/S)0.00
P/FCF Ratio0.00
Enterprise Value/Market Cap0.74
Enterprise Value/Revenue2.16
Enterprise Value/Gross Profit9.97
Enterprise Value/Ebitda18.50
Forecast
1Y Price Target
$40.33Price Target Upside19.25% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering4
Tat Techno Business Overview & Revenue Model
Company DescriptionTat Techno (TATT) is a technology-driven company specializing in the development and provision of innovative solutions within the fields of telecommunications and information technology. The company focuses on creating advanced software applications, cloud computing services, and IoT (Internet of Things) solutions designed to enhance connectivity and efficiency for businesses across various sectors. With a commitment to research and development, TATT aims to stay at the forefront of technological advancements, enabling clients to optimize their operations and improve their service offerings.
How the Company Makes MoneyTat Techno generates revenue through multiple streams, primarily by offering subscription-based software services and cloud solutions to businesses. This model provides a steady income as companies pay recurring fees for access to TATT's platforms. Additionally, TATT engages in custom software development projects, charging clients for tailored solutions that meet specific operational needs. The company also benefits from partnerships with telecommunications providers, which allows for bundled service offerings and shared revenue from joint ventures. Furthermore, TATT invests in research and development to create proprietary technologies that can be licensed to other firms, further diversifying its income sources.
Tat Techno Earnings Call Summary
Earnings Call Date:Aug 11, 2025
(Q2-2025)
| % Change Since: |
Next Earnings Date:Nov 12, 2025
Earnings Call Sentiment Positive
The earnings call reflected a strong performance with significant revenue growth, improved profitability, and successful expansion of long-term agreements and backlog. Despite challenges in MRO intake and exchange rate impacts, TAT demonstrated operational resilience and maintained positive cash flow. The company's strategic initiatives and successful public offering bolster its financial flexibility and growth potential.Q2-2025 Updates
Positive Updates
Revenue Growth and Profitability
Second quarter revenue increased by 18% to $43.1 million compared to $36.5 million in Q2 of 2024. For the first 6 months of 2025, revenue grew by 21% to $85.2 million. Gross profit increased by 35% and gross margin expanded by 320 basis points to 25.1%. Adjusted EBITDA increased by 41.9% to $6.1 million, with a notable adjusted EBITDA margin improvement from 11.9% to 14.0%.
Long-term Agreements and Backlog Growth
Long-term agreement value and backlog expanded by $85 million to $524 million, reflecting both new contract wins and continued customer base expansion. This includes a major win with a cargo carrier valued at $40 million to $55 million.
Operational Flexibility and Cash Flow
Operational flexibility allowed TAT to offset softer MRO volumes by capitalizing on trading opportunities, resulting in approximately $7 million in positive cash flow from operations in the quarter.
Successful Public Offering
Completed a successful public offering, raising $45 million and increasing financial flexibility to pursue potential accretive acquisitions and enhance growth profile.
Negative Updates
MRO and APU Volatility
Experienced some weaknesses in MRO intake, with APU work decreasing slightly on a sequential basis due to short-term shifts in customer behavior and macroeconomic uncertainties.
Exchange Rate Impact
Suffered from the strength of the Israeli shekel compared to the U.S. dollar, resulting in an increase of cost from exchange rate differences by over $0.5 million, reducing net profit by $400,000 in Q2 2025 compared to Q1 2025.
Company Guidance
In the second quarter of 2025, TAT Technologies reported an 18% year-over-year increase in revenue, reaching $43 million, with a notable 21% growth for the first half of the year compared to the previous year. The company achieved a gross profit increase of 35%, with gross margins expanding by 320 basis points to 25.1%. Adjusted EBITDA rose by 41.9% to $6.1 million, representing an adjusted EBITDA margin of 14.0%. The company's backlog and long-term agreement value expanded by $85 million, reaching $524 million, reflecting new contract wins and increased long-term visibility. Despite some short-term MRO intake weaknesses, TAT Technologies capitalized on trading opportunities, tripling its trading and leasing revenue. The company also completed a successful public offering, raising $45 million to enhance financial flexibility for potential acquisitions. TAT Technologies continues to focus on operational efficiencies and strategic growth, with a disciplined approach to M&A, aiming to expand its addressable market and accelerate growth.Tat Techno Financial Statement Overview
Summary
Tat Techno shows strong revenue growth and improved profitability, with increased gross and net profit margins. However, cash flow challenges and operational inefficiencies suggest potential liquidity issues that need addressing.Income Statement
Tat Techno has demonstrated significant revenue growth, increasing from $75.4M in 2020 to $152.1M in 2024, reflecting a robust expansion strategy. The gross profit margin has improved from 10.8% in 2020 to 21.7% in 2024, highlighting better cost management or pricing strategies. The net profit margin also shows positive growth, moving from a negative 4.4% in 2020 to a positive 7.3% in 2024, indicating enhanced profitability. However, EBIT and EBITDA margins, while improving, suggest some operational challenges that need addressing.78
Positive
Balance Sheet
The company's debt-to-equity ratio has improved, moving from 0.19 in 2020 to 0.18 in 2024, indicating a conservative approach to debt. The return on equity (ROE) has increased from negative values in early years to 10% in 2024, showing improved efficiency in generating profits from shareholders' investments. However, the equity ratio has decreased slightly from 69.1% in 2020 to 68.5% in 2024, suggesting a slight increase in leverage.65
Positive
Cash Flow
Tat Techno has faced challenges with free cash flow, with significant negative values over the years, culminating in -$10.9M in 2024. The operating cash flow to net income ratio is negative, suggesting that the company is not efficiently converting its net income into cash. However, the company has shown resilience by reducing negative free cash flow from -$21M in 2022 to -$10.9M in 2024.55
Neutral
| Breakdown | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 152.12M | 113.79M | 84.56M | 77.97M | 75.36M |
| Gross Profit | 33.01M | 22.47M | 15.93M | 11.27M | 8.44M |
| EBITDA | 17.48M | 11.14M | 2.96M | 989.00K | 248.00K |
| Net Income | 11.17M | 4.67M | -1.75M | -3.91M | -3.30M |
Balance Sheet | |||||
| Total Assets | 163.36M | 145.58M | 126.65M | 110.83M | 116.12M |
| Cash, Cash Equivalents and Short-Term Investments | 7.13M | 16.64M | 7.72M | 12.87M | 24.13M |
| Total Debt | 19.66M | 29.95M | 29.82M | 15.84M | 15.34M |
| Total Liabilities | 51.39M | 54.89M | 51.08M | 34.05M | 35.84M |
| Stockholders Equity | 111.97M | 90.68M | 75.57M | 76.78M | 80.28M |
Cash Flow | |||||
| Free Cash Flow | -10.94M | -3.33M | -21.08M | -18.29M | 693.00K |
| Operating Cash Flow | -5.82M | 2.25M | -4.87M | -1.49M | 6.10M |
| Investing Cash Flow | -3.85M | -3.58M | -16.12M | -15.64M | -5.41M |
| Financing Cash Flow | 161.00K | 10.24M | 15.80M | 6.04M | 7.65M |
Tat Techno Technical Analysis
Neutral
33.82
Price Trends
33.80
Positive
31.42
Positive
28.91
Positive
Market Momentum
0.31
Positive
44.92
Neutral
17.25
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TATT, the sentiment is Neutral. The current price of 33.82 is below the 20-day moving average (MA) of 36.09, above the 50-day MA of 33.80, and above the 200-day MA of 28.91, indicating a neutral trend. The MACD of 0.31 indicates Positive momentum. The RSI at 44.92 is Neutral, neither overbought nor oversold. The STOCH value of 17.25 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for TATT.
Tat Techno Peers Comparison
Overall Rating
UnderperformOutperform
Sector (64)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
75 Outperform | $213.48M | 18.26 | 23.40% | ― | 72.82% | 80.22% | |
75 Outperform | $446.29M | 28.23 | 10.47% | ― | 25.96% | 68.93% | |
72 Outperform | $89.99M | 26.41 | 6.40% | ― | 24.78% | 23.18% | |
64 Neutral | $10.73B | 15.74 | 7.56% | 2.01% | 2.76% | -15.10% | |
49 Neutral | $5.45B | ― | -60.83% | ― | ― | -4.00% | |
47 Neutral | $1.16B | ― | -30.69% | ― | 87.67% | 18.33% | |
25 Underperform | $436.02M | ― | 115.25% | ― | ― | ― |
* Industrials Sector Average
Performance Comparison
TATT
Tat Techno
33.82
18.11
115.28%
ISSC
Innovative Solutions And Support
11.62
4.84
71.39%
CODA
Coda Octopus Group
7.96
0.97
13.88%
EH
Ehang Holdings
16.16
4.49
38.47%
EVTL
Vertical Aerospace
4.61
-2.59
-35.97%
ACHR
Archer Aviation
8.50
5.22
159.15%
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.