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1. Company Snapshot

1.a. Company Description

TAT Technologies Ltd., together with its subsidiaries, provides solutions and services to the commercial and military aerospace, and ground defense industries in the United States, Israel, and internationally.The company operates through four segments: Original Equipment Manufacturing (OEM) of Heat Transfer Solutions and Aviation Accessories; Maintenance, Repair, and Overhaul (MRO) Services for Heat Transfer Components and OEM of Heat Transfer Solutions; MRO Services for Aviation Components; and Overhaul and Coating of Jet Engine Components.It designs, develops, and manufactures a range of heat transfer solutions, such as pre-cooler and oil/fuel hydraulic heat exchangers used in mechanical and electronic systems in commercial, military, and business aircraft; environmental control and power electronics cooling systems for use in aircraft and ground applications; and a range of other mechanical aircraft accessories and systems, such as pumps, valves, and turbine power units.


The company also provides MRO services for heat transfer components, as well as for manufacturing heat transfer solutions; and aviation components.In addition, it engages in the operation of a repair station, which provides heat transfer MRO services for airlines, air cargo carriers, maintenance service centers, and the military; and the overhaul and coating of jet engine components, including turbine vanes and blades, fan blades, variable inlet guide vanes, and afterburner flaps.The company was formerly known as Galagraph Ltd.


and changed its name to TAT Technologies Ltd.in May 1992.TAT Technologies Ltd.


was founded in 1969 and is based in Netanya, Israel.

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1.b. Last Insights on TATT

TAT Technologies Ltd.'s recent performance was driven by its 9th consecutive quarter of expanding revenues, with a 34% year-over-year growth in revenue, a 139% increase in net income, and a 67% rise in adjusted EBITDA for the full year of 2024. The company's strong backlog of $429 million and significant competitive strengths in the aerospace and defense sectors contributed to its growth. Additionally, TAT's impressive earnings CAGR of 64.3% over the past five years indicates a strong track record of growth, with expectations for continued expansion in 2025.

1.c. Company Highlights

2. TAT Technologies' Q3 Earnings: Strong Revenue Growth and Margin Expansion

TAT Technologies delivered a robust third quarter with 14% revenue growth to $46.2 million, driven by strong demand across its core business lines and market share gains. Gross profit increased 37% to $11.6 million, and gross margin expanded to 25.1%. Adjusted EBITDA rose 34% to $6.8 million, representing a record adjusted EBITDA margin of 14.6%. Earnings per share (EPS) came in at $0.37, slightly below estimates of $0.4. The company's strong financial performance was underpinned by its diversified business model, which helped offset market dynamics.

Publication Date: Nov -17

📋 Highlights
  • Revenue Growth:: 14% increase to $46.2M driven by core business demand and market share gains.
  • EBITDA Margin:: Record 14.6% margin with adjusted EBITDA up 34% to $6.8M.
  • Cash Generation:: $7.5M operational cash flow (QoQ) and $9.5M year-to-date (YTD) in 2025.
  • Balance Sheet Strength:: $47.1M cash, $12.1M debt, and 0.5x debt-to-EBITDA ratio.
  • Strategic Expansion:: Focus on M&A to add MRO services and expand thermal system capabilities.

Operational Highlights and Business Outlook

TAT's backlog and LTA value remained robust at $520 million, validating its business strategy. The company's agility remains a competitive advantage, and it is focusing on identifying strategic opportunities to accelerate its growth strategy. TAT has added experienced corporate development executives to evaluate M&A activities, with a focus on adding high-quality MRO services to its portfolio. The company is optimistic about 2026, with a strong backlog, large pipeline of opportunities, and growing demand in both OEM and MRO.

Cash Flow and Balance Sheet Strength

The company generated $7.5 million in cash flow from operations in the quarter and $9.5 million for the first nine months of 2025. TAT ended the quarter with $47.1 million in cash and $12.1 million in total debt, resulting in a low debt-to-EBITDA ratio of 0.5x. The company's strong balance sheet is expected to support its growth strategy, with an equity ratio expected to stay high at 70-75%. Analysts estimate next year's revenue growth at 13.2%, indicating a positive outlook for the company's future performance.

Valuation Metrics

TAT Technologies' current valuation metrics indicate a moderate premium, with a P/E Ratio of 33.47 and an EV/EBITDA of 24.14. The company's P/B Ratio stands at 2.76, while its P/S Ratio is 3.11. The ROIC is 8.18%, and the ROE is 10.9%, indicating a decent return on capital. The Net Debt / EBITDA ratio is -1.34, reflecting the company's net cash position. These metrics suggest that the company's strong financial performance and growth prospects are partially priced in, but there may be further upside potential.

3. NewsRoom

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Central Pattana, TAT and The Walt Disney (Thailand) Launched Magical Festivities Land in Thailand: Disney-Themed Christmas Experience

Dec -04

Source: globenewswire.com

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Boston Partners Makes New $13.21 Million Investment in TAT Technologies Ltd. $TATT

Nov -29

Source: defenseworld.net

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Reviewing TAT Technologies (NASDAQ:TATT) and Spirit Aerosystems (NYSE:SPR)

Nov -22

Source: defenseworld.net

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TAT Technologies: When Expectations Are High, Earnings Execution Has To Be Tip-Top

Nov -17

Source: seekingalpha.com

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TAT Technologies Ltd. (TATT) Q3 2025 Earnings Call Transcript

Nov -13

Source: seekingalpha.com

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TAT Technologies Ltd. (TATT) Q3 Earnings and Revenues Lag Estimates

Nov -12

Source: zacks.com

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TAT Technologies Reports Third Quarter 2025 Results

Nov -12

Source: prnewswire.com

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TAT Technologies to Report Q3 Results: What's in Store for the Stock?

Nov -10

Source: zacks.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (6.78%)

6. Segments

Maintenance Repair and Overhaul Services for Aviation Components and Lease

Expected Growth: 7.3%

Growing demand for efficient MRO services, increasing aircraft fleet, and rising need for cost-effective solutions drive the market growth.

Maintenance Repair and Overhaul Services for Heat Transfer Components and Original Equipment Manufacturing of Heat Transfer Solutions

Expected Growth: 4.5%

Growing demand for efficient heat transfer solutions, increasing adoption of sustainable technologies, and rising need for maintenance and repair services in the aerospace and industrial sectors drive the growth of TAT Technologies' business.

Original Equipment Manufacturing of Heat Transfer Solutions and Aviation Accessories

Expected Growth: 8.5%

Growing demand for fuel-efficient aircraft, increasing adoption of advanced materials, and rising defense spending are expected to drive the growth of TAT Technologies' heat transfer solutions and aviation accessories in the aerospace and defense industries.

Overhaul and Coating of Jet Engine Components

Expected Growth: 5.5%

Growing demand for fuel-efficient engines, increasing adoption of advanced coatings, and rising need for engine component overhauls drive the market growth, driven by the growing commercial aviation industry and increasing focus on sustainability.

7. Detailed Products

MRO Services

TAT Technologies Ltd. provides MRO (Maintenance, Repair, and Overhaul) services for commercial and military aircraft, including engine and component maintenance, repair, and overhaul.

Aerostructures

TAT Technologies Ltd. designs, manufactures, and supplies aerostructures, including aircraft components, assemblies, and sub-assemblies.

OEM Aftermarket Services

TAT Technologies Ltd. provides aftermarket services, including spare parts, repair, and maintenance, for OEMs and their customers.

Engineering and Development

TAT Technologies Ltd. offers engineering and development services, including design, testing, and certification, for aerospace and defense applications.

Supply Chain Management

TAT Technologies Ltd. provides supply chain management services, including procurement, logistics, and inventory management, for aerospace and defense industries.

8. TAT Technologies Ltd.'s Porter Forces

Forces Ranking

Threat Of Substitutes

The threat of substitutes for TAT Technologies Ltd. is medium due to the presence of alternative products and services in the market.

Bargaining Power Of Customers

The bargaining power of customers is high due to the concentration of buyers in the aerospace and defense industries.

Bargaining Power Of Suppliers

The bargaining power of suppliers is low due to the availability of multiple suppliers for raw materials and components.

Threat Of New Entrants

The threat of new entrants is low due to the high barriers to entry in the aerospace and defense industries.

Intensity Of Rivalry

The intensity of rivalry is high due to the presence of established competitors in the market.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 23.76%
Debt Cost 6.39%
Equity Weight 76.24%
Equity Cost 8.00%
WACC 7.62%
Leverage 31.16%

11. Quality Control: TAT Technologies Ltd. passed 5 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
Avon Protection

A-Score: 5.1/10

Value: 1.8

Growth: 5.6

Quality: 3.8

Yield: 3.8

Momentum: 10.0

Volatility: 5.7

1-Year Total Return ->

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Chemring

A-Score: 5.1/10

Value: 1.7

Growth: 5.2

Quality: 6.4

Yield: 2.5

Momentum: 10.0

Volatility: 4.7

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Montana Aerospace

A-Score: 4.4/10

Value: 3.6

Growth: 7.4

Quality: 4.9

Yield: 0.0

Momentum: 8.0

Volatility: 2.7

1-Year Total Return ->

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Stock-Card
Senior

A-Score: 4.4/10

Value: 4.3

Growth: 3.6

Quality: 3.6

Yield: 0.6

Momentum: 8.5

Volatility: 5.7

1-Year Total Return ->

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Stock-Card
TAT Technologies

A-Score: 4.2/10

Value: 3.9

Growth: 5.1

Quality: 5.6

Yield: 0.0

Momentum: 10.0

Volatility: 0.7

1-Year Total Return ->

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Stock-Card
Avio

A-Score: 4.0/10

Value: 1.4

Growth: 6.2

Quality: 4.5

Yield: 0.6

Momentum: 10.0

Volatility: 1.0

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

39.0$

Current Price

39$

Potential

-0.00%

Expected Cash-Flows