Last Update 10 Feb 26

ONDS: Capital Raise And Roboteam Deal Will Support $110m Ambition

Analysts have nudged their blended price target for Ondas higher by a few dollars, citing recent price target increases from several firms following the company's large $1b capital raise, the planned $80m Roboteam acquisition, and stronger reported Q3 results and backlog.

Analyst Commentary

Bullish Takeaways

Bullish analysts see the recent price target increases following the US$1b capital raise as a sign that the new cash position of about US$840m strengthens Ondas' ability to execute on its plans without near term funding pressure.
Several firms tie their higher targets to the planned US$80m Roboteam acquisition, viewing the deal as a way to expand the business and support the company's previously communicated US$110m revenue goal for next year.
The reported Q3 revenue of US$10.1m and an all time high backlog of US$22.2m are cited as support for a more constructive view on growth and visibility, which bullish analysts link to a higher valuation framework.
Analysts who are positive on the name point to Ondas' open platform and ecosystem of technologies, partners, and programs as key factors that could help sustain customer demand and support margin improvement over time.

Bearish Takeaways

Bearish analysts are likely to focus on execution risk around integrating the US$80m Roboteam acquisition and deploying the large cash balance efficiently, which could affect how quickly Ondas converts its backlog into revenue and profit.
The use of a large registered direct offering of common shares and warrants may raise questions about dilution and how much of the higher price targets already assume successful use of the new capital.
While one firm highlights a path for gross margin to approach 70% over the next few years, more cautious views may question how quickly Ondas can move from the currently reported 26% margin level to any higher margin profile.
The cluster of recent price target hikes after strong Q3 numbers and a strengthened balance sheet could leave less room for error if future quarters do not match current expectations on backlog conversion and growth.

What's in the News

The U.S. Department of Commerce withdrew plans to restrict Chinese made drones, which keeps Ondas grouped with other U.S. drone names such as AeroVironment and Unusual Machines in ongoing sector coverage (Reuters).
Ondas Holdings Inc. changed its corporate name to Ondas Inc., updating its articles of incorporation, bylaws, equity incentive plans, and governance documents to reflect the new name.
The company completed a follow on equity offering of common stock and pre funded warrants totaling about US$1b through a registered direct structure.
Ondas entered into a Series B Preferred Stock Purchase Agreement, issuing 303,250 Series B Convertible Preferred shares at US$27.70 per share for gross proceeds of about US$8.4m.
The board approved a transition in auditors, with Rosenberg Rich Baker Berman, P.A. to complete the 2025 audit and BDO USA, P.C. engaged as the independent registered public accounting firm for the 2026 fiscal year.

Valuation Changes

Fair Value: The fair value estimate is unchanged at 18.375, indicating no adjustment in the core valuation anchor used in the model.
Discount Rate: The discount rate has risen slightly from 8.07% to 8.09%, which can modestly reduce the present value of future cash flows in the model.
Revenue Growth: The revenue growth assumption remains very large at about 173%, with no change between the prior and updated inputs.
Net Profit Margin: The net profit margin assumption has fallen slightly from 9.09% to 8.29%, implying a more cautious view on future profitability relative to revenue.
Future P/E: The future P/E multiple has risen slightly from about 228x to about 250x, reflecting a higher valuation multiple being applied to projected earnings.

Strategic partnerships and expanding defense contracts in various sectors are driving significant revenue growth and market diversification for Ondas Holdings.
Advancements in autonomous systems and private network technologies are set to enhance operational efficiency, potentially improving margins and financial performance.
High operating expenses and debt reliance are challenges, with conservative revenue expectations and volatile margins posing risks to future profitability and growth.

Catalysts

About Ondas Holdings

Provides private wireless, drone, and automated data solutions in the United States and internationally.What are the underlying business or industry changes driving this perspective?

Ondas anticipates record revenue growth in 2025, primarily driven by Ondas Autonomous Systems (OAS), due to significant backlog and expanding programs with Optimus and Iron Drone systems in defense and homeland security sectors. This will directly impact revenue.
The strategic partnership with Palantir Technologies aims to leverage advanced AI capabilities to enhance operational efficiencies and scale OAS’s operations, which is expected to support the revenue ramp and broaden their customer base, influencing earnings and margins through improved operational scale.
The expansion of OAS’s market presence, with increased customer engagement and government contracts in defense sectors in Israel and the UAE, is set to secure additional military customers, suggesting potential revenue growth and improved market diversification.
Expected improvements in operating leverage as revenues grow, particularly at OAS, are set to recover gross margins, which could reach 50% or better in the second half of 2025, impacting net margins positively.
Continued strategic value building at Ondas Networks and progress in private wireless network technologies for rail operations, which includes 900-megahertz network rollouts and new product opportunities, aims to unlock further revenue streams and bolster financial performance.

Ondas Holdings Earnings and Revenue Growth

Ondas Holdings Future Earnings and Revenue Growth

Assumptions

How have these above catalysts been quantified?

Analysts are assuming Ondas Holdings's revenue will grow by 141.1% annually over the next 3 years.
Analysts are not forecasting that Ondas Holdings will become profitable in next 3 years. To represent the Analyst Price Target as a Future PE Valuation we will estimate Ondas Holdings's profit margin will increase from -433.8% to the average US Communications industry of 10.7% in 3 years.
If Ondas Holdings's profit margin were to converge on the industry average, you could expect earnings to reach $16.3 million (and earnings per share of $0.08) by about July 2028, up from $-46.9 million today.
In order for the above numbers to justify the analysts price target, the company would need to trade at a PE ratio of 40.9x on those 2028 earnings, up from -7.8x today. This future PE is greater than the current PE for the US Communications industry at 28.4x.
Analysts expect the number of shares outstanding to grow by 7.0% per year for the next 3 years.
To value all of this in today's terms, we will use a discount rate of 7.59%, as per the Simply Wall St company report.

Ondas Holdings Future Earnings Per Share Growth

Risks

What could happen that would invalidate this narrative?

Ondas Holdings faced challenges in 2024, such as extending timelines at Ondas Networks and disruptions due to military activity in Israel, which could impede future revenue growth if similar issues recur.
The company's revenue expectations for 2025 remain conservative at $25 million, with uncertainties related to Ondas Networks affecting the potential for revenue expansion.
Gross margins are expected to be volatile due to the early stages of platform adoption and shifts in revenue mix, which may impact net margins and profitability.
As of 2024, Ondas Holdings reported high operating expenses and adjusted EBITDA loss, with existing revenues not covering these expenses, posing a risk to future earnings if revenue growth does not accelerate as projected.
The $52 million in debt outstanding and reliance on raising additional funds or extending debt terms might impact the company's financial health and its ability to invest in growth initiatives.

Valuation

How have all the factors above been brought together to estimate a fair value?

The analysts have a consensus price target of $2.5 for Ondas Holdings based on their expectations of its future earnings growth, profit margins and other risk factors. However, there is a degree of disagreement amongst analysts, with the most bullish reporting a price target of $3.0, and the most bearish reporting a price target of just $2.0.
In order for you to agree with the analyst's consensus, you'd need to believe that by 2028, revenues will be $151.6 million, earnings will come to $16.3 million, and it would be trading on a PE ratio of 40.9x, assuming you use a discount rate of 7.6%.
Given the current share price of $2.1, the analyst price target of $2.5 is 16.0% higher.
We always encourage you to reach your own conclusions though. So sense check these analyst numbers against your own assumptions and expectations based on your understanding of the business and what you believe is probable.

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Disclaimer

AnalystConsensusTarget is a tool utilizing a Large Language Model (LLM) that ingests data on consensus price targets, forecasted revenue and earnings figures, as well as the transcripts of earnings calls to produce qualitative analysis. The narratives produced by AnalystConsensusTarget are general in nature and are based solely on analyst data and publicly-available material published by the respective companies. These scenarios are not indicative of the company's future performance and are exploratory in nature. Simply Wall St has no position in the company(s) mentioned. Simply Wall St may provide the securities issuer or related entities with website advertising services for a fee, on an arm's length basis. These relationships have no impact on the way we conduct our business, the content we host, or how our content is served to users. The price targets and estimates used are consensus data, and do not constitute a recommendation to buy or sell any stock, and they do not take account of your objectives, or your financial situation. Note that AnalystConsensusTarget's analysis may not factor in the latest price-sensitive company announcements or qualitative material.

Analyst Optimism Grows for Ondas Holdings Amid Strong Sector Momentum and Upward Valuation Revisions