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Elbit Systems Ltd. (ESLT) Message Board

  • stinky_perro stinky_perro Feb 12, 2012 9:55 PM Flag

    $65 M profit write off

    I was looking to re-enter Elbit at around $37 but with the latest profit write off news, I don't think this stock will hold $30. If Elbit continues to trade at the industry standard PE of 11ish, then the profit write off will spike the PE to an unsustainable 14+.

    Is anyone else doing the math out there?? I realize the company has a lot of cash and promised to buy a million shares last year but 65 Million USD is a big hit. If someone thinks I forgot to carry a decimal over somewhere I am all ears. If not, I think I best save my buy order for 30 and below.

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    • New 52 week low today... and lower lows to come. This thing was an obviousl sell in February when I first posted this thread. This is going to take a long time to recover. But first, the sell off will continue until valuations match current defense industry averages. Sorry longs... you guys are out of luck on this one.

    • Slowly but surely, ESLT seems to be going below $30. People keep selling before Q1 earnings release. Very little interest/volume. I think this stock will keep its downward slide. Good luck.

    • I am still not seeing how folks have thrown an upgrade to ESLT... they lost a significant stream from the nation state of Georgia and have just warned about losing a huge chunk of their profist this last FY. Also, aren't contracts spread out through several years? Governements do not pay for a full up contract in one lump sum. They spread it as the contract gets executed and meets established milestones. That said, how is this latest cancelation going to affect PEG? I just don't see any YoY growth going from '10 to '11... I also do not see dividend security going into the next FY. One of their major customer has already promulgated huge cuts in Defense spending. Elbit's primary products are UASs, C4ISR systems and to a certain exten EW devices. CIED capability demands will wind down as Afghanistan comes to an end. The Hermes UAS series has huge competition from American GA, and the Big 3 (Boeing, LockMart and Northrop...).

      I just don't see this stock remaining above 30 for much longer... Perhaps someone can enlightened me.

    • Re this link:

      http://mobile.businessweek.com/news/2012-02-13/elbit-discount-to-s-p-defense-is-buy-to-leumi-israel-overnight.html

      Where is he getting those valuations for Elbit? Contract Expiration? Huh? This looks more like Turkish austerity measures... Big difference.

 
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