Elbit Systems combines exceptional backlog visibility and defense-tech execution with a valuation that already prices in much of the growth.
Overview
Elbit Systems is a battle-tested Israeli defense technology integrator whose portfolio spans unmanned aircraft, precision fires, electro-optics, communications, cyber, electronic warfare, and platform upgrades. Its competitive position is strengthened by IDF validation, high switching costs, security and export qualifications, and a global customer base. **The $32.0 billion backlog, up 34% year over year and equal to 3.74x revenue, is the central growth and visibility driver.** International customers account for 63% of group revenue and 73% of backlog, although Israel still represented 37% of the latest quarter’s revenue. Q2 2026 revenue rose 15.9% to $2.287 billion, GAAP net income increased 38% to $173.6 million, and non-GAAP EPS rose 28% to $4.14, beating consensus by 27.8%. Non-GAAP operating margin reached 10.4%, above the 10.0% internal target, while first-half operating cash flow rose to $517.8 million. Management reiterated mid-teens growth guidance and plans approximately $300 million of capacity investment. However, the stock closed at $783.83 after a 7.35% post-earnings decline, trades above 65x trailing GAAP earnings, and has a DCF base value of $357.64. **The business is strong, but valuation currently outpaces operations.**