ELTK

Rating neutralTentativeAI MemoPost-earnings T+1

Eltek

As of 2026-05-19/Post-earnings T+1/Confidence low

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Data freshness

AI Memo

As of 2026-05-19 • Model: RankAlpha Sentiment Codex

Decision Panel

Action, confidence, horizon, and decision blockers at a glance.

Report quality notice

Coverage is limited for this name. This memo is usable, but confidence is lower and evidence depth is thinner than a standard report.

Action

neutral

Confidence

low

Horizon

—

Key catalyst

Q1 2026 print confirms a sharp profit reset • 2026-05-19

Expected move: -12%

Biggest risk

The Q1 print shows that execution is still fragile: revenue fell, gross margin turned negative, and FX plus regional disruption and logistics issues hit results. If those headwinds persist, profitability recovery can stay deferred and any backlog benefit may arrive too slowly to support the share price.

Invalidation

Break below $6 or thesis failure.

What would change my mind?

Demand appears intact enough to keep backlog building, and management says the company can convert that backlog into revenue over the coming periods. If logistics stabilize and new order flow keeps carrying into 2026-2027, the market can re-rate the name off improved visibility.

Research note

Recommendation

neutral

Confidence

low

As of

2026-05-19

Base target

p=57%

Bull target

$12

p=18%

Bear target

p=25%

Key bullets

Fast scan of bull, bear, and watch items

BullKey bullets

Margin recovery depends on FX and operational normalization
Backlog growth can support revenue if execution normalizes
Demand appears intact enough to keep backlog building, and management says the company can convert that backlog into revenue over the coming periods.

BearKey bullets

Regional security disruptions can reduce operational availability and delay shipments.
Temporary logistical constraints and backlog timing remain an execution risk.
The Q1 operating and net losses leave the recovery dependent on converting backlog into profitable shipments.

WatchKey bullets

Q1 2026 print confirms a sharp profit reset

Summary

High-level snapshot

Recommendation

neutral

Model confidence

low

Timeframe

Asset

Equity

Trigger

Post-earnings T+1

Base case: $8 (p=57%)

Bull/Bear spread: +29% / -38%

Vs latest close: Bull +29% · Base -12% · Bear -38%

Scenario probabilities

Bull Target: $12 (p=18%)Base Target: $8 (p=57%)Bear Target: $6 (p=25%)

Commentary

News tone is mixed but still cautionary: the May 19 print confirmed a meaningful revenue and profit reset, while management also emphasized backlog growth and gradual improvement. Recent third-party coverage described a negative share reaction after the first-quarter loss and revenue decline. No trustworthy post-print analyst revision set is available in the packet, social-context data is not provided, and coverage remains thin, so this stays a low-conviction monitoring view rather than a conviction thesis.

As of 2026-05-19 • Updated bi-weekly / post-earningsSource: Internal modelMethodology

Analyst Summary

Thesis highlights from the latest analysis

Bull Case

Bear Case

Drivers

Scannable catalysts and supporting factors

Margin recovery depends on FX and operational normalization
Backlog growth can support revenue if execution normalizes

Scenarios

Bull Target (Scenario probability)

$12 / p=18% prob

Base Target (Scenario probability)

$8 / p=57% prob

Bear Target (Scenario probability)

$6 / p=25% prob

Price $9 as of 2026-05-29

Nearest Scenario: Base (∆ 12%)

Targets vs latest close: Bull +29% · Base -12% · Bear -38%

Sentiment & Exposure

Sentiment unavailable: insufficient coverage

Events

Other notable items detected

EVENT2026-05-19
Q1 2026 print confirms a sharp profit reset
Eltek's May 19, 2026 first-quarter release reported $10.4 million of revenue, a $1.9 million operating loss, and a $2.9 million net loss, with management citing USD/NIS weakness, regional security disruptions, and temporary logistical constraints as the main drags [#PR-2026-05-19].
Prob 85.00% • Move 9.00% • Priced-in 72.00%

Short-term Catalysts

Next few weeks

No short-term catalysts

Long-term Catalysts

Months to a year

Margin recovery depends on FX and operational normalization
2026-12-31
The March 9 full-year release showed 2025 revenue growth but a much weaker profitability profile, with gross margin down to 15% and net income down to $0.8 million; management linked the pressure to manufacturing transition costs, new plating-line investment, workforce ramp, and USD weakness versus the shekel [#PR-2026-03-09].
Prob 55% • Move 15% • Priced-in 38%
Backlog growth can support revenue if execution normalizes
2027-09-30
Eltek said backlog has grown significantly and reiterated on May 19 that it expects to convert that backlog into revenue over coming periods; the April 1 order announcement added about $5.3 million of purchase orders with deliveries starting in Q2 2026 and running through September 2027 [#PR-2026-04-01] [#PR-2026-05-19].
Prob 60% • Move 12% • Priced-in 44%

Risks

Regional security disruptions can reduce operational availability and delay shipments.
Temporary logistical constraints and backlog timing remain an execution risk.
The Q1 operating and net losses leave the recovery dependent on converting backlog into profitable shipments.
USD weakness versus the shekel can continue to inflate reported expenses and compress margin.

Peers

Symbol	Summary
DSWL	A smaller electronics manufacturer that is useful for framing micro-cap execution and liquidity sensitivity, though the product overlap with Eltek's PCB business is limited.
LINK	Another micro-cap hardware comp that helps bracket thin-liquidity trading behavior and operational risk, but the operating overlap with Eltek is loose.
FIEE	A same-sector small-cap reference point for valuation and liquidity context, but it is more of an adjacency comp than a direct product peer.

Sources

Internal and external references used in this analysis

Model source: RankAlpha Sentiment Codex
Human targets: serper
Analysis date: 2026-05-19

AI Stock Memo: ELTK - Eltek - RankAlpha