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1. Company Snapshot

1.a. Company Description

Eltek Ltd.manufactures, markets, and sells printed circuit boards (PCBs) in Israel, Europe, North America, India, the Netherlands, and internationally.The company offers a range of custom designed PCBs, including rigid, double-sided, and multi-layer PCBs, and flexible circuitry boards.


It also offers high density interconnect, flex-rigid, and multi-layered boards.It primarily serves manufacturers of defense and aerospace, medical, industrial, telecom, and networking equipment, as well as contract electronic manufacturers and others.The company markets and sells its products primarily through direct sales personnel, sales representatives, and PCB trading and manufacturing companies.


Eltek Ltd.was incorporated in 1970 and is headquartered in Petach Tikva, Israel.Eltek Ltd.


is a subsidiary of Nistec Golan Ltd.

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1.b. Last Insights on ELTK

Eltek Ltd.'s recent positive momentum is driven by anticipation of strong Q4 2024 and annual results, scheduled to be released on March 11, 2025. The company's printed circuit board solutions have likely benefited from growing demand in the technology sector. With no recent negative news or legal issues, the upcoming earnings release is expected to be a catalyst for the stock.

1.c. Company Highlights

2. Eltek's Q3 2025 Earnings: Operational Challenges and Growth Prospects

Eltek reported revenues of $13.3 million for Q3 2025, with a gross profit of $1.6 million and a net loss of $0.2 million. The earnings per share (EPS) came in at $0.00339, significantly below the estimated $0.24. The gross margin stood at 12%, impacted by the depreciation of the U.S. dollar against the Israeli shekel, which increased expenses and reduced gross profits. The company's operating profit was $50,000, a marginal improvement. The financial performance was affected by operational issues related to the ramp-up of new equipment and integration of new production staff.

Publication Date: Nov -23

📋 Highlights
  • Q3 Financial Performance:: Sales of $13.3 million, gross profit of $1.6 million, net loss of $0.2 million, driven by USD depreciation against the Israeli shekel.
  • Operational Challenges:: Higher depreciation, raw material consumption, and energy costs caused by new equipment ramp-up and staff integration, expected to stabilize by mid-2026.
  • Market Demand & Competition:: Defense sector dominates 63% of sales, rigid flex products account for 66%, but new foreign competitors may limit pricing power.
  • Production Expansion:: New coating line to expand capacity and streamline manufacturing, on track for completion by mid-2026.
  • Liquidity & Cash Flow:: Positive operating cash flow of $2 million and $11.6 million in cash balances as of September 30, 2025, with operating profit of $50,000 reported.

Operational Challenges and Future Prospects

The company faced operational difficulties due to the ramp-up of new equipment and integration of new production staff, resulting in higher depreciation expenses, increased raw material consumption, and higher energy costs. However, as Eli Yaffe, Chief Executive Officer, mentioned during the call, "we expect these effects to gradually subside as the new line stabilizes and the team reaches full proficiency." Demand for the company's products remains strong, driven by the defense sector, which accounted for 63% of quarterly sales.

Capacity Expansion and RRP Project

Eltek's production capacity expansion program is progressing well, with the new coating line expected to streamline manufacturing processes and expand capacity by mid-2026. The RRP project continues to progress according to plan, with the system expected to be live by 2026. The company generated positive cash flow from operating activities of $2 million and had cash balances of $11.6 million as of September 30, 2025.

Valuation and Growth Prospects

With a P/S Ratio of 1.1 and an EV/EBITDA of 12.9, the market seems to be pricing in moderate growth prospects. Analysts estimate revenue growth at 9.0% for next year. Considering the current valuation multiples and growth prospects, it is essential to monitor the company's progress in stabilizing its production processes and improving its gross margin. The ROE of 2.68% and ROIC of 3.76% indicate that the company is generating returns, albeit modest.

3. NewsRoom

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Evercel (OTCMKTS:EVRC) vs. Eltek (NASDAQ:ELTK) Head-To-Head Comparison

Dec -03

Source: defenseworld.net

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Head-To-Head Analysis: Eltek (NASDAQ:ELTK) versus CPS Technologies (NASDAQ:CPSH)

Dec -02

Source: defenseworld.net

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Eltek Ltd. (ELTK) Q3 2025 Earnings Call Transcript

Nov -18

Source: seekingalpha.com

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Eltek Ltd. Reports 2025 Third Quarter Financial Results

Nov -18

Source: prnewswire.com

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Eltek Sets Earnings Release Date and Conference Call to Report Third Quarter 2025 Results on November 18, 2025

Nov -10

Source: prnewswire.com

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Eltek Receives Purchase Orders Totaling $2.4 Million

Aug -25

Source: prnewswire.com

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Eltek Ltd. (ELTK) Q2 2025 Earnings Call Transcript

Aug -14

Source: seekingalpha.com

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Eltek Ltd. Reports Strong Second-Quarter 2025 Results

Aug -14

Source: prnewswire.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (9.24%)

6. Segments

Defense and Aerospace Equipment

Expected Growth: 9%

Eltek Ltd.'s 9% growth in Defense and Aerospace Equipment is driven by increasing global military spending, rising demand for advanced defense systems, and growing adoption of unmanned aerial vehicles (UAVs). Additionally, the company's focus on innovation, strategic partnerships, and expanding presence in emerging markets contribute to its growth momentum.

Contract Electronic Manufacturers and Others

Expected Growth: 8%

Eltek Ltd's Contract Electronic Manufacturers and Others segment growth of 8% is driven by increasing demand for electronic components, outsourcing trends in the electronics industry, and the company's strategic partnerships with leading OEMs. Additionally, Eltek's focus on high-reliability and complex products, as well as its investments in technology and manufacturing capabilities, contribute to its growth momentum.

Industrial Equipment

Expected Growth: 11%

Eltek Ltd.'s Industrial Equipment segment growth of 11% is driven by increasing demand for efficient power conversion solutions, expansion into new markets, and strategic partnerships. Additionally, the company's focus on research and development has led to innovative products, enhancing its competitive edge and driving revenue growth.

Medical Equipment

Expected Growth: 12%

Eltek Ltd's 12% growth in Medical Equipment is driven by increasing demand for diagnostic and therapeutic devices, advancements in medical technology, and growing healthcare expenditure. Additionally, the company's focus on innovative products, strategic partnerships, and expanding distribution channels contribute to its growth momentum.

Other

Expected Growth: 7%

Eltek's 7% growth in 'Other' segment is driven by increasing demand for high-reliability power supplies in the defense and aerospace industries, coupled with growing sales of custom power systems to leading OEMs. Additionally, the company's strategic investments in R&D and expansion into new geographic markets have contributed to this growth.

7. Detailed Products

DC Power Systems

Eltek's DC Power Systems provide reliable and efficient power supply solutions for telecom, data center, and industrial applications.

High Efficiency Rectifiers

Eltek's High Efficiency Rectifiers offer high power density, low energy consumption, and high reliability for telecom, data center, and industrial applications.

Solar Power Systems

Eltek's Solar Power Systems provide off-grid and grid-tie solar power solutions for telecom, rural electrification, and industrial applications.

Inverters and Converters

Eltek's Inverters and Converters offer high-reliability and high-efficiency power conversion solutions for telecom, data center, and industrial applications.

Battery Monitoring Systems

Eltek's Battery Monitoring Systems provide real-time monitoring and control of battery health and performance for telecom, data center, and industrial applications.

Power Systems for Railway

Eltek's Power Systems for Railway provide reliable and efficient power supply solutions for railway infrastructure and rolling stock applications.

8. Eltek Ltd.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Eltek Ltd. faces moderate threat from substitutes due to the availability of alternative products in the market.

Bargaining Power Of Customers

Eltek Ltd. has a large customer base, but the customers have significant bargaining power due to the availability of alternative products.

Bargaining Power Of Suppliers

Eltek Ltd. has a diverse supplier base, which reduces the bargaining power of individual suppliers.

Threat Of New Entrants

Eltek Ltd. operates in a moderately competitive industry, and new entrants may face significant barriers to entry.

Intensity Of Rivalry

Eltek Ltd. operates in a highly competitive industry, and the intensity of rivalry is high due to the presence of several established players.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 19.86%
Debt Cost 3.95%
Equity Weight 80.14%
Equity Cost -4.83%
WACC -3.09%
Leverage 24.78%

11. Quality Control: Eltek Ltd. passed 7 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
Barco

A-Score: 5.8/10

Value: 6.7

Growth: 4.7

Quality: 6.4

Yield: 5.6

Momentum: 7.0

Volatility: 4.3

1-Year Total Return ->

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Stock-Card
Vaisala

A-Score: 4.9/10

Value: 4.4

Growth: 6.1

Quality: 6.8

Yield: 3.8

Momentum: 3.0

Volatility: 5.3

1-Year Total Return ->

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Stock-Card
Incap

A-Score: 4.7/10

Value: 6.8

Growth: 8.6

Quality: 7.0

Yield: 0.0

Momentum: 4.0

Volatility: 2.0

1-Year Total Return ->

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Stock-Card
Eltek

A-Score: 4.5/10

Value: 5.4

Growth: 4.2

Quality: 6.1

Yield: 3.1

Momentum: 5.0

Volatility: 3.0

1-Year Total Return ->

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Stock-Card
TT Electronics

A-Score: 4.1/10

Value: 8.6

Growth: 2.8

Quality: 2.7

Yield: 3.1

Momentum: 7.5

Volatility: 0.0

1-Year Total Return ->

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Stock-Card
NCAB

A-Score: 3.7/10

Value: 1.1

Growth: 7.2

Quality: 5.6

Yield: 5.0

Momentum: 2.0

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

9.53$

Current Price

9.53$

Potential

0.00%

Expected Cash-Flows