Elbit Systems Defense Contracts: The $30B Test

Elbit Systems defense contracts have never looked stronger. Three superlatives landed on the company in a single spring. In March, Elbit became Israel’s most valuable listed company. In May, S&P Maalot handed it a AAA local rating. Days later, its order backlog crossed $30 billion for the first time in its history.

The market has noticed, violently. The stock has quadrupled in two years and briefly traded above $1,000. Yet most covering analysts sit at neutral, with average price targets far below the market price, making ESLT one of the widest gaps between operational momentum and professional skepticism in global defense. We tracked the setup in our January Elbit Systems deep dive, part of our broader defense coverage. Resolving that gap is the job of this update.

The Quarter That Redefined the Company

Elbit’s first-quarter 2026 results, reported May 26 from Haifa, beat on every line that matters.

The Backlog Mechanics

The backlog is the headline. It reached $30.2 billion at quarter-end, up more than $7 billion year over year and up $2.1 billion in a single quarter from the $28.1 billion of December 2025. About 71% comes from outside Israel, and roughly 49% is scheduled for delivery through 2027, giving unusual medium-term revenue visibility. Growth was broad: Land revenue jumped 27%, C4I and Cyber rose 17%, ISTAR and electronic warfare rose 17%, while Aerospace added 2%.

Two weeks earlier, S&P Maalot raised the company’s long-term local rating to ilAAA with a stable outlook, citing improving financial ratios and the record backlog against surging global defense budgets. The stock jumped more than 8% on the earnings, even as the numbers arrived from an economy that contracted at an annualized rate of roughly 3.5% in mid-2025 during the twelve-day war. Defense demand has decoupled from the domestic cycle.

Elbit Systems Defense Contracts Go European

The same May 26 morning, Elbit announced a contract worth approximately $1.4 billion from an undisclosed European customer, one of its largest ever. The five-year program spans uncrewed autonomous systems, networked land electronic warfare, precision-guided munitions for artillery and air-to-ground use, and electro-optical reconnaissance, all tied together by software-defined radios. It is a whole-army modernization package, not a single product sale.

From Athens to Belgrade

Greece came first. On April 6, Elbit won roughly $750 million (€650 million) to supply PULS rocket artillery to the Hellenic Armed Forces under a government-to-government agreement. The deal runs four years of deliveries plus ten years of support and includes precision-guided rockets and loitering munitions, with mandated participation by Greek industry and technology transfer.

Germany is the reported prize. In March, Elbit partnered with KNDS to market the EuroPULS variant to European armies, alongside cooperation with MBDA and Diehl Defence on localized production. Globes has reported that Germany plans a EuroPULS procurement worth about €6 billion. That program remains a reported plan, not a signed contract, and should be modeled accordingly.

Further southeast, an investigation by BIRN and Haaretz, based on obtained documents, found that Elbit and Serbia’s state-owned Yugoimport-SDPR are establishing a joint drone factory in Šimanovci near Belgrade, with Elbit holding 51%. The plant would build short-range strike drones and long-range UAVs flying up to six kilometers altitude. Elbit declined to comment. The venture follows verified Serbian purchases from Elbit of $335 million in early 2025 and $1.6 billion in August 2025.

The 2026 Contract Wave

The scale of recent Elbit Systems defense contracts is easiest to see in one table.

The American Franchise

Elbit Systems defense contracts in America are consolidating quietly too.

On May 12, the Army awarded Elbit Systems of America a $212 million delivery order to continue producing the Enhanced Night Vision Goggle-Binocular. Elbit now serves as the sole ENVG-B producer, a departure from the Army’s earlier split-vendor approach, and Globes reports a separate development win for the next-generation Binocular Night Observation Device that opens a path to a production phase valued around $450 million.

The more strategic move is the June teaming with Anduril Industries. Together they are offering the SIGMA Mobile Tactical Cannon, a wheeled 155mm self-propelled howitzer, for the Army’s artillery competition. Elbit America brings the gun and a fully domestic supply chain, per CEO Luke Savoie, while Anduril contributes command-and-control software and edge computing, with its Lattice platform planned for future variants. Add the Army’s selection of Elbit’s Iron Fist active protection system for Bradley fighting vehicles, and the pattern is clear: Israeli combat-proven hardware, wrapped in American software and American factories.

Buying the Autonomous Future

Elbit is spending its boom on the next war’s technologies rather than the last one’s.

On May 27, its FUSE unit, formerly Flying Production within the C4I and Cyber division, acquired 100% of Israel’s Bluewhite. The company’s Pathfinder kit converts conventional vehicles into autonomous platforms, and its Compass software runs them as coordinated fleets, with more than 100,000 autonomous operating hours already logged. The purchase extends Elbit’s autonomy stack from aerial swarms to the ground, the backbone of manned-unmanned teaming that every Western army is now specifying.

Lasers, Submarines, and the Gulf Whisper

Directed energy is the second frontier. Elbit developed the high-power laser at the heart of the ground-based Iron Beam interceptor, which destroys drones and rockets at negligible marginal cost per shot, and it showcased airborne high-power laser systems at ILA Berlin in June, aiming to move interception above the clouds. At the same show, Elbit and Diehl Defence announced a strategic partnership around loitering munitions, including promotion of the SkyStriker for German requirements.

The industrial base is widening too. Globes reports that Elbit’s Cyclone subsidiary and Thyssenkrupp Marine Systems inaugurated a plant in northern Israel to produce composite submarine components, taking the company into naval manufacturing supply chains. Cyclone also holds the $34 million Israel MoD contract to design external, range-extending fuel tanks for the F-35 “Adir,” and a separate $130 million award covers integrating Israeli avionics and electronic warfare on CH-53K heavy-lift helicopters. Even logistics reflects the security mindset: Calcalist reports the company is removing Chinese-made electric vehicles from its corporate fleet.

One quieter thread deserves careful wording. An Israeli press investigation, echoed across regional media, alleged covert defense sales to Gulf states, including C-MUSIC airborne missile-defense systems installed on Qatar’s royal fleet and Elbit subsystems such as JHMCS helmets flowing into Saudi-bound F-15 programs through US primes. None of this is confirmed by the company, but the reports signal demand for Israeli protective technology that runs ahead of formal diplomacy.

The Skeptics’ Ledger

Now the other side of the trade, because the bull case is not free.

Investors who bought the Nasdaq secondary less than a year ago at $375 have more than doubled their money, and the March milestone of a $40 billion valuation, overtaking Teva, came with most professional coverage refusing to chase. The multiple embeds years of flawless execution on a backlog that must now be manufactured, staffed, and delivered on fixed prices.

The Political Overhang

The political overhang is real as well. France barred Israeli firms from major arms expos in 2024, organizers screened off Israeli booths at the 2025 Paris Air Show, and Spain declared an arms embargo on Israeli defense products in September 2025. A UN special rapporteur’s 2025 report named Elbit among companies profiting from the Gaza war, and activist campaigns target its facilities from Britain to the Balkans. So far the order book says demand outweighs boycott. That balance is an assumption, not a law.

The Risks That Matter

• Valuation versus targets. Most analysts rate the stock neutral with targets well below market; any execution stumble meets a demanding multiple.
• European political risk. Embargoes, expo bans, and activist pressure can delay or unwind specific programs, as Spain showed in 2025.
• Reported is not signed. The €6 billion German EuroPULS program and the Serbian venture rest on reports and investigations, not company confirmations.
• Capacity strain. Converting a $30.2 billion backlog requires scaling plants, suppliers, and skilled labor without margin slippage on fixed-price terms.
• Conflict-cycle dependence. A durable regional de-escalation would be humanly welcome and commercially deflationary for urgency-driven orders.
• Fiscal concentration. Roughly 29% of backlog is Israeli; domestic budget politics and shekel dynamics matter.
• Governance structure. A 42.1% controlling stake limits the float and the influence of outside shareholders.

Closing Thoughts

Elbit Systems has completed a transformation from a respected niche electronics house into the flagship of an entire economy’s most globally demanded export sector. The record backlog, the AAA local rating, and the doubled dividend are facts. So are the neutral ratings and the price targets sitting far below the tape.

The next verdict arrives on August 11, when second-quarter results show whether margins keep expanding as the backlog converts. Beyond that, watch three catalysts: whether Germany’s reported EuroPULS program becomes a signed contract, whether the $1.4 billion European customer is revealed, and how fast capacity investment turns orders into revenue. Elbit Systems defense contracts have already won the demand war. The stock’s fate now rests on the quieter war of execution.

Elbit Systems Long (Buy)
Enter At: 770.26
T.P_1: 802.21
T.P_2: 844.81
T.P_3: 883.85
T.P_4: 940.65
T.P_5: 977.92
T.P_6: 1018.74
T.P_7: 1054.24
T.P_8: 1086.18
T.P_9: 1118.13
T.P_10: 1160.72
T.P_11: 1206.87
S.L: 704.60