TEL AVIV, June 1, 2026, 13:04 (IDT)
- Elbit shares in Tel Aviv slipped roughly 2.9% midday. The TA-125 dropped 1.5%.
- The stock is still up over 11% in five sessions after earnings and order news last week.
- Investors are looking at the record backlog and fresh contract wins, but some are cautious on valuation and the risk of execution slipping.
Elbit Systems shares dropped in Tel Aviv on Monday, trimming last week’s rally. The Israeli defense contractor posted record quarterly revenue and reported its order book topped $30 billion.
The stock was changing hands at 245,940 ILA at 12:48 p.m. local, off 2.91%. That’s roughly 2,459.40 shekels a share. The TA-125 index dropped 1.53%. ILA is the Tel Aviv quote unit, equal to 0.01 shekel.
Elbit’s retreat is worth watching because the company is one of the most visible ways to track demand for Israeli and allied defense tech on the public market. Despite dropping on Monday, MarketScreener data showed Elbit shares were still up about 11.4% in the last five sessions and had gained 34.1% since Jan. 1.
Elbit posted earnings of $3.87 a share ex-items for Q1, up from $2.57 the year before and topping LSEG’s $3.28 view. Revenue hit a record $2.2 billion, rising from $1.9 billion, Reuters said.
Backlog hit $30.2 billion, which is the value of orders secured but not delivered. Of that, 71% is from non-Israeli markets. About half of the total should be fulfilled by 2027, giving investors some forward visibility and a way to track performance.
Elbit Systems said it picked up more order flow after results. The company announced on May 28 that it won a $350 million contract to upgrade main battle tanks for an international client over four years. The work covers fire-control, communications, and situational-awareness systems. CEO Bezhalel Machlis called Elbit a “global leader in tank modernization programs.” PR Newswire
Elbit shares lost ground but the news behind the move stuck around. CEO Machlis told Reuters the company is in talks with Israel’s defence ministry about hardware for taking down Hezbollah drones, possibly with lasers. Elbit is “very active in energy weapons such as lasers,” Machlis said. Reuters
Elbit’s Tel Aviv-listed stock is trading at a price-to-earnings ratio of about 70.75, according to Google Finance. That is steep for a defence group. The stock’s high multiple means investors aren’t pricing in much tolerance for delays, margin pressure or slow order intake.
Morgan Stanley lowered its price target. TipRanks showed analyst Kristine Liwag keeping a Hold on Elbit, with the target reduced to $978 from $1,115 on May 28. Hold means Liwag isn’t telling clients to buy more at this price, but she isn’t pushing a sell, either.
U.S.-listed Elbit traded weaker ahead of the Nasdaq session. The stock ended May 29 at $880.89 and showed $870.55 in early premarket trade, before regular U.S. hours started.
Peers moved in different directions. Lockheed Martin slipped around 1.25% ahead of the U.S. open. RTX and L3Harris edged up, so Monday’s move didn’t look like a full-sector selloff in aerospace and defence.
But the trade can go the other way. Elbit’s own disclosures warn about risks from government budgets, necessary approvals, political factors in Israel and the U.S., and long-term fixed-price contracts that can squeeze margins if costs jump. If demand for conflict fades, deliveries are delayed, or the market wants a lower multiple, shares could have a tough time despite the big contract backlog.
