Elbit Systems - Company Valuation
Ilit Raz
EMBA – Dickens Cohort
Jan 2013
Company Valuation - Elbit Systems Ltd.
The following document will try to describe the financial assets and the portfolio of “Elbit Systems” and a company valuation. As part of my military service I spend some time in different project in Elbit Systems, working with their R&D department. For the company valuation I’ll use Discount Cash Flow (DCF) method. After valuating the company I’ll calculate the discount premium rates that can serve investors and be a supportive tool for their decision.
Company Background
“Elbit Systems” develops, manufactures and integrates advanced, highperformance defense electronic and electro-optic systems for customers throughout the world. The Company focuses on designing, developing, manufacturing and integrating command, control, communication, computer, intelligence, surveillance and reconnaissance (C ISR) network centric systems, including unmanned vehicles, for defense and homeland security applications. They also perform upgrade programs for airborne, land and naval defense platforms. Moreover, they develop and manufacture systems and aero structures for the commercial aviation market. They also provide a range of support services. The company based in Haifa, Israel and currently has 12,500 employees around the world mainly in the US. Elbit’s stock is traded in both TASE (Tel Aviv Stock Exchange) and the NASDAQ as ESLT.
4
Elbit Systems has an average risk level, which mainly affected by geopolitical risks that can affect the company sales, security budget in major markets such as Israel and the US.
Ilit Raz
EMBA – Dickens Cohort
Jan 2013
Discount Cash Flow (DCF)
Valuation using discounted cash flows is a method for determining the current value of a company using future cash flows adjusted for time value. The future cash flow set is made up of the cash flows within the determined forecast
EMBA – Dickens Cohort
Jan 2013
Company Valuation - Elbit Systems Ltd.
The following document will try to describe the financial assets and the portfolio of “Elbit Systems” and a company valuation. As part of my military service I spend some time in different project in Elbit Systems, working with their R&D department. For the company valuation I’ll use Discount Cash Flow (DCF) method. After valuating the company I’ll calculate the discount premium rates that can serve investors and be a supportive tool for their decision.
Company Background
“Elbit Systems” develops, manufactures and integrates advanced, highperformance defense electronic and electro-optic systems for customers throughout the world. The Company focuses on designing, developing, manufacturing and integrating command, control, communication, computer, intelligence, surveillance and reconnaissance (C ISR) network centric systems, including unmanned vehicles, for defense and homeland security applications. They also perform upgrade programs for airborne, land and naval defense platforms. Moreover, they develop and manufacture systems and aero structures for the commercial aviation market. They also provide a range of support services. The company based in Haifa, Israel and currently has 12,500 employees around the world mainly in the US. Elbit’s stock is traded in both TASE (Tel Aviv Stock Exchange) and the NASDAQ as ESLT.
4
Elbit Systems has an average risk level, which mainly affected by geopolitical risks that can affect the company sales, security budget in major markets such as Israel and the US.
Ilit Raz
EMBA – Dickens Cohort
Jan 2013
Discount Cash Flow (DCF)
Valuation using discounted cash flows is a method for determining the current value of a company using future cash flows adjusted for time value. The future cash flow set is made up of the cash flows within the determined forecast
References: 1. 2. 3. 4. Elbit Systems website - http://www.elbitsystems.com/elbitmain/ Yahoo! Finance - http://finance.yahoo.com/q?s=ESLT Wiki Wealth - http://www.wikiwealth.com/research:eslt Financial Times http://markets.ft.com/research/Markets/Tearsheets/Businessprofile?s=ESLT:TLV 5. Elbit System 2011 Annual Report http://ir.elbitsystems.com/phoenix.zhtml?c=61849&p=irol-reportsannual