What the new defense and in flight connectivity orders mean for investors

Gilat Satellite Networks (GILT) recently reported two sizeable contract wins: a multi million dollar SATCOM deal with a European Ministry of Defense and US$43 million in Sidewinder antenna orders from an in flight connectivity provider.

Both contracts indicate ongoing demand for Gilat Satellite Networks solutions across commercial aviation and government defense clients, with scheduled deliveries extending over the next 12 to 18 months and adding visibility to contracted business.

Gilat Satellite Networks’ share price has been volatile, with a 9.06% 7 day share price return but declines of 16.80% over 30 days and 21.18% over 90 days. At the same time, the 1 year total shareholder return of 78.64% and 3 year total shareholder return of 99.38% point to a much stronger longer term picture as investors weigh recent contract wins against earlier gains and changing risk perceptions.

If you are looking beyond Gilat Satellite Networks and want to see what else is benefiting from connectivity trends, take a look at 52 AI infrastructure stocks.

With Gilat Satellite Networks trading at US$12.88 and sitting at a reported 49% discount to the average analyst price target of US$19.20, you have to ask: is this a genuine opening, or is the market already factoring in future growth?

Most Popular Narrative: 32.9% Undervalued

Compared with Gilat Satellite Networks’ last close at $12.88, the most widely followed narrative points to a fair value of $19.20, built on detailed long term contract and earnings assumptions using a 10.7% discount rate.

Gilat's established relationships and expanding contract wins with leading NGSO/LEO/MEO satellite constellations (e.g., OneWeb, SES, and Iris Square) position it as a key supplier amid large-scale satellite network rollouts, supporting backlog and recurring equipment sales and contributing to top-line performance.

Want to see what revenue path and profit margin profile sit behind that $19.20 fair value for Gilat Satellite Networks? The narrative uses assumptions about contract wins, a specific growth rate, and a future earnings multiple that is above the sector norm. Curious which of those assumptions has the largest impact in the model? The full breakdown sets out the details clearly.

Result: Fair Value of $19.20 (UNDERVALUED)

However, the bullish narrative on Gilat Satellite Networks still faces pressure from the slower than planned Stellar Blu ramp up and from exposure to unpredictable, contract driven Peru revenues.

Another View: What the DCF Says About Gilat Satellite Networks

The analyst fair value for Gilat Satellite Networks is built on detailed earnings and contract assumptions, but our DCF model tells a different story. On a future cash flow basis, Gilat Satellite Networks screens as slightly overvalued, with an estimate of US$11.84 compared with the current US$12.88 price.

That gap is not huge in absolute terms, yet it suggests less room for error if contracts, margins, or capital needs play out differently to expectations. The key question for you is which set of assumptions you trust more when those cash flows are still uncertain.

Simply Wall St performs a discounted cash flow (DCF) on every stock in the world every day (check out Gilat Satellite Networks for example). We show the entire calculation in full. You can track the result in your watchlist or portfolio and be alerted when this changes, or use our stock screener to discover 43 high quality undervalued stocks. If you save a screener we even alert you when new companies match - so you never miss a potential opportunity.

Next Steps

Given the mix of enthusiasm and caution around Gilat Satellite Networks, it makes sense to move quickly and look at the full picture yourself. To weigh both the concerns and the potential upsides side by side, start by reviewing the 4 key rewards and 2 important warning signs.

Looking for more investment ideas beyond Gilat Satellite Networks?

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.