Is there any guidance on capital expenditures, R&D spending, or potential acquisitions following the strong quarter?

Answer

The press release for Eltek’s Q2 2025 results highlights the 20 % QoQ revenue jump and a gross‑margin expansion to 24 %, but it does not contain any forward‑looking statements on capital‑expenditure plans, R&D budgets, or a “look‑for‑acquisition” strategy. The company’s management commentary is limited to the operational performance of the quarter and the immediate outlook for the remainder of fiscal‑2025; there is no explicit guidance on how the excess cash flow will be allocated beyond the normal working‑capital needs.

Trading implications

• Fundamentals: The lack of disclosed reinvestment or M&A guidance means the market must price the upside based purely on the momentum of the current earnings beat. If the cash‑generation rate remains at the current pace, the balance sheet could support a modest increase in cap‑ex or R&D in the next fiscal‑year, but without a concrete plan the upside is largely speculative.
  
• Technicals: The stock has already reacted positively, breaking above its recent resistance at $12.00 and holding the $12.50‑$13.00 range on higher volume. In the absence of a clear reinvestment narrative, the price may continue to be driven by the “strong‑quarter” momentum and short‑covering rather than a fundamental catalyst.
  
• Actionable view: For a trader, the current bias is short‑to‑medium‑term bullish on the breakout—targeting the next resistance near $13.50 with a stop just below the $12.00 support. However, be prepared for a pull‑back if the market later demands concrete guidance on cap‑ex, R&D, or acquisition activity; a failure to deliver could trigger a re‑valuation and a downside move toward the $11.00‑$11.50 support zone.
  

In short, while the quarter’s performance is impressive, investors and traders should treat the lack of explicit spending or acquisition guidance as a “unknown” that could become a catalyst for future volatility. Until the company issues a forward‑looking plan, the current price action is best viewed as a continuation of the earnings‑driven rally rather than a reflection of longer‑term growth investments.