Elbit Systems Ltd. (ESLT) rose to the highest level in more than two years in Israel to close its discount to its U.S-traded share as the defense developer said it got a five-year U.S. contract for $44.8 million.
Shares of the Haifa-based company jumped as much as 6 percent before advancing 5 percent to 190.20 shekels, or the equivalent of $53.53, the highest level since April 2011, at 2:35 p.m. in Tel Aviv, in more than double the three-month average trading volume. The stock was the third-biggest gainer in percentage terms on Israel’s benchmark TA-25 Index (TA-25), which rose 1.3 percent. The shares in New York closed at $53.30 on Sept. 27.
“The share has caught up with its New York move,” Guil Bashan, an analyst at I.B.I.-Israel Brokerage & Investments Ltd. in Tel Aviv, said by phone today. “The news of the contract is what is pushing up the shares, creating a positive sentiment around the stock.”
The share has advanced 17 percent this month, after the company met with investors in the U.S. at the start of the month and as the company in August reported a 30 percent surge in profit.
“Elbit Systems holds meetings with existing and potential investors around the world,” Dalia Rosen, VP and head of communications at Elbit said today by phone. “About a month ago the company met with a number of investors in the United States.”
The company is seeking to boost its focus on advanced defense electronics and optics, Chief Executive Officer Bezhalel Machlis said in a Bloomberg interview in August. Global defense spending last year contracted for the first time in 15 years as U.S. and European cuts exceeded rising outlays in China and Russia, the Stockholm International Peace Research Institute said in April.
To contact the reporter on this story: Shoshanna Solomon in Tel Aviv at firstname.lastname@example.org
To contact the editor responsible for this story: Claudia Maedler at email@example.com