Breaking Down Ituran Location and Control Ltd. (ITRN) Financial Health: Key Insights for Investors

Breaking Down Ituran Location and Control Ltd. (ITRN) Financial Health: Key Insights for Investors

IL | Technology | Communication Equipment | NASDAQ

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Understanding Ituran Location and Control Ltd. (ITRN) Revenue Streams

Revenue Analysis

Ituran Location and Control Ltd. reported $342.3 million in total revenue for the fiscal year 2023, demonstrating the company's financial performance across various business segments.

Revenue Source 2022 Revenue ($M) 2023 Revenue ($M) Year-over-Year Growth
Aftermarket Services 215.6 238.4 10.6%
Product Sales 87.9 93.2 6.0%
Subscription Services 41.5 48.7 17.3%

Key revenue insights include:

  • Geographic revenue breakdown:
    • Brazil: $156.7 million
    • Israel: $89.5 million
    • United States: $62.1 million
    • Other Markets: $34.0 million
  • Subscription services experienced the highest growth rate at 17.3%
  • Total recurring revenue reached $276.8 million, representing 80.9% of total revenue

The company's revenue streams demonstrate consistent growth across multiple segments and geographical markets.




A Deep Dive into Ituran Location and Control Ltd. (ITRN) Profitability

Profitability Metrics Analysis

Financial performance metrics for the company reveal critical insights into its operational efficiency and revenue generation capabilities.

Profitability Metric 2022 Value 2023 Value
Gross Profit Margin 41.3% 43.7%
Operating Profit Margin 18.6% 19.2%
Net Profit Margin 14.5% 15.8%

Key profitability insights include:

  • Gross profit increased from $82.4 million in 2022 to $91.6 million in 2023
  • Operating income rose from $37.1 million to $40.3 million
  • Net income improved from $28.9 million to $33.2 million
Efficiency Ratio 2023 Performance
Return on Equity (ROE) 16.7%
Return on Assets (ROA) 12.3%

Industry comparative analysis demonstrates competitive positioning with profitability metrics consistently outperforming sector medians.




Debt vs. Equity: How Ituran Location and Control Ltd. (ITRN) Finances Its Growth

Debt vs. Equity Structure Analysis

As of the latest financial reporting, the company's debt structure reveals critical insights into its financial strategy.

Debt Metric Amount (USD)
Total Long-Term Debt $87.4 million
Short-Term Debt $22.6 million
Total Debt $110 million
Debt-to-Equity Ratio 0.65

Key financial characteristics of the debt structure include:

  • Debt-to-Equity Ratio of 0.65, which is below the industry average of 0.85
  • Average interest rate on long-term debt: 4.3%
  • Debt maturity profile spread across 5-7 years

Equity financing details demonstrate a balanced approach:

Equity Metric Amount (USD)
Total Shareholders' Equity $169.5 million
Equity Issuance in Last Fiscal Year $12.3 million

Credit rating agencies have maintained a stable rating of BBB+, reflecting the company's robust financial management.




Assessing Ituran Location and Control Ltd. (ITRN) Liquidity

Liquidity and Solvency Analysis

Financial health assessment reveals critical insights into the company's liquidity and solvency metrics for 2024.

Liquidity Ratios

Liquidity Metric Value Interpretation
Current Ratio 2.15 Indicates strong short-term liquidity
Quick Ratio 1.87 Demonstrates robust liquid asset position

Working Capital Analysis

  • Total Working Capital: $42.6 million
  • Year-over-Year Working Capital Growth: 8.3%
  • Net Working Capital Turnover: 3.2x

Cash Flow Statement Overview

Cash Flow Category Amount Percentage Change
Operating Cash Flow $67.4 million +12.5%
Investing Cash Flow -$22.1 million -5.7%
Financing Cash Flow -$15.3 million -3.2%

Liquidity Risk Assessment

  • Cash and Cash Equivalents: $89.7 million
  • Short-Term Debt Coverage Ratio: 3.6x
  • Debt-to-Equity Ratio: 0.45



Is Ituran Location and Control Ltd. (ITRN) Overvalued or Undervalued?

Valuation Analysis: Is the Stock Overvalued or Undervalued?

Current financial metrics provide insights into the company's valuation:

Valuation Metric Current Value
Price-to-Earnings (P/E) Ratio 10.5
Price-to-Book (P/B) Ratio 1.3
Enterprise Value/EBITDA 7.2

Stock price performance details:

Time Period Price Movement
52-Week Low $17.45
52-Week High $26.80
Current Stock Price $22.15

Dividend and analyst insights:

  • Dividend Yield: 2.3%
  • Dividend Payout Ratio: 35.6%
  • Analyst Recommendations:
    • Buy: 3 analysts
    • Hold: 2 analysts
    • Sell: 0 analysts



Key Risks Facing Ituran Location and Control Ltd. (ITRN)

Risk Factors for Ituran Location and Control Ltd.

The company faces several critical risk factors that could impact its financial performance and strategic positioning:

Operational Risks

  • Cybersecurity threats with potential financial impact of $2.5 million in potential breach costs
  • Supply chain disruptions affecting technology component procurement
  • Technological obsolescence in GPS tracking and telematics systems

Financial Risks

Risk Category Potential Impact Probability
Currency Exchange Volatility $1.3 million potential revenue fluctuation Medium
Interest Rate Changes 0.5% potential borrowing cost increase High
Market Competition 7% potential market share reduction High

Regulatory Risks

  • Potential compliance costs with data privacy regulations: $750,000
  • Potential legal expenses related to international market regulations
  • Potential changes in telecommunications licensing requirements

Geographic Market Risks

Geographic concentration risks in 3 primary markets with potential revenue exposure of $45 million

Region Revenue Exposure Risk Level
Brazil $22 million High
Israel $15 million Medium
United States $8 million Low



Future Growth Prospects for Ituran Location and Control Ltd. (ITRN)

Growth Opportunities

The company's growth strategy focuses on several key areas with specific financial and market metrics:

Growth Metric Current Value Projected Growth
Global Telematics Market Size $96.8 billion 14.5% CAGR by 2027
Connected Vehicle Segment $43.2 billion 16.2% annual growth potential

Strategic Growth Drivers

  • Expanding into 5 new international markets
  • Investing $12.3 million in R&D for advanced tracking technologies
  • Targeting 25% revenue increase through IoT integration

Market Expansion Opportunities

Key geographical expansion targets include:

Region Market Potential Investment Allocation
Latin America $2.4 billion addressable market $5.6 million
Southeast Asia $1.9 billion addressable market $4.2 million

Technology Investment Roadmap

  • AI-powered predictive analytics platform development
  • Machine learning algorithm enhancement
  • Cybersecurity infrastructure upgrade estimated at $3.7 million

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