Freedom Broker raises TP on telematics company Ituran after recent earnings

Shares of Ituran Location and Control, an Israeli small cap listed in the U.S. that provides satellite-based vehicle monitoring services, offer about 15% upside, according to an update on the company by Freedom Broker (seen by Oninvest). New initiatives are expected to drive growth in subscriber numbers, while dividends and share buybacks should support the stock, the analysts say.

Freedom Broker values Ituran at $57 per share. That implies nearly 15% upside to the closing price on Monday and represents an 16% upgrade to Freedom’s previous target price.

Freedom raised its target price after the company reported fourth-quarter and full-year results on March 5. Quarterly revenue rose 13% year over year to $93.5 million, while net income increased 10.4% to $15.3 million. Diluted earnings per share reached $0.77, up 10%, exceeding the consensus of analysts by about 3%, Freedom wrote.

For the full year, Ituran delivered what the company described as “record financial metrics across the board.” Revenue increased 7.0% to $359 million, net income 8.0% to $58 million, and EPS 8.1% to $2.92.

The strong results allowed the company to pay a $20 million special dividend, on top of a $10 million quarterly dividend, bringing total dividends declared for the year to $60 million, more than 100% of net income for last year.

Earlier in March, the company also announced a new $10 million share buyback program. Freedom believes the combination of dividends and buybacks will help support the stock.

Ituran is looking to expand its addressable market through three strategic initiatives, according to co-CEO Eyal Sheratzky, whose comments were cited in the earnings release.

The first involves launching the IturanMob platform in the U.S., targeting small and mid-size car rental companies. The platform allows users to locate and book vehicles while enabling operators to manage fleets digitally.

The second initiative aims to monetize the extensive volumes of data collected by the company to provide insights to third parties.

The third project, Credit Carbon, connects electric vehicle owners with buyers of carbon credits, allowing EV drivers to monetize their lower carbon footprint. Under the system, companies with surplus emission allowances can sell them to businesses that exceed regulatory limits, enabling those companies to offset their emissions.

Freedom also highlighted the expansion of Ituran’s partnership with Stellantis, which will involve installing the Israeli company’s connectivity solutions in Fiat Strada vehicles in South America.

All these initiatives should support long-term subscriber and revenue growth, though the most meaningful financial impact is expected between 2027 and 2028, Freedom argues.

Year to date, Ituran shares have gained about 15.5%.

Only two Wall Street analysts currently cover the stock, and both rate it “buy.” The average target price is $56 per share, implying upside of roughly 13% from the last closing price.