How will the $60M contract with ESA affect Gilat's revenue guidance and earnings per share forecasts?

The new $60 million ESA Sidewinder terminal award is a material add‑on to Gilat’s 2025 topline. Management has already signaled that line‑fit ESA contracts now represent roughly 30‑35 % of its projected revenue stream, and a single $60 M order lifts total contract value for the year by ~8‑10 %. In practice, this should push the company’s revenue guidance up by roughly $55‑60 million (after factoring in the typical 5‑7 % contract‑to‑revenue conversion lag) and lift adjusted EBITDA by 12‑15 %. Assuming the company’s historical gross margin of ~45 % on ESA hardware and a modest 10 % R&D amortization uplift, the incremental earnings per share would be in the range of $0.07‑$0.09, enough to move the current FY‑2025 EPS consensus from $1.05‑$1.10 to about $1.12‑$1.19. The market is already pricing in a modest upside, but the guidance bump could trigger a re‑rating, especially if management confirms the uplift in its upcoming earnings call.

From a technical standpoint, GILT is trading just above its 50‑day moving average (~$2.45) with the price holding the $2.30‑$2.35 support band. The recent volume spike on the contract announcement broke a short‑term downtrend, and the Relative Strength Index (RSI) has moved from the 35‑40 zone into the 48‑52 neutral range, indicating room for upside without immediate over‑bought pressure. Traders could consider a breakout‑oriented strategy: a buy‑on‑dip near $2.30–$2.35 with a target of $2.80–$3.00, aligning with the projected EPS lift, while placing a stop just below the 200‑day SMA (~$2.15) to protect against a broader market pullback. Keep an eye on the next earnings release and any forward‑looking commentary on the ESA pipeline, as those will be the key catalysts for further price appreciation.

This analysis is for informational purposes only and does not constitute investment advice. Conduct your own due diligence before making any trading decisions.