We encountered bullish papers on Ituran Position and Controls Ltd (ITRN). In this article, we will summarize the Bulls' paper on ITRN. Ituran Location and Control Ltd. (ITRN) share trading at $37.82 as of May 16^Th. According to Yahoo Finance, ITRN lags behind P/E at 14.01.

A technician at a workstation welds electronic components for vehicle tracking equipment.

In the mid-1990s, rampant vehicle theft in Tel Aviv caused expensive insurance premiums and losses. Izzy and Eyal Sheratzky used their insurance investigation background to acquire advanced but underutilized military-grade tracking technology and transformed it by pioneering a subscription-based rental model. The shift from expensive up-front hardware sales to affordable, often-emerging monthly expenses has built an early “security service” business that turned major theft issues into predictable and scalable revenue sources. As the networks between Israeli cities expand, theft rates decline due to deterrence and cyber impacts, while partnerships with insurers and banks reduce customer acquisition costs, thus accelerating growth.

The company strategically renamed Ituran, especially Latin America in Brazil and Argentina, has high crime rates and the middle class is increasingly driving the urgent need for vehicle safety. By 2024, Brazil alone will account for 25% of revenue. Ituran's vertically integrated model, including manufacturing, installation and physical vehicle recovery, distinguishes it from competitors that primarily offer software solutions. Financially speaking, Ituran’s 2.4 million subscribers generated $336 million in revenue in 2024, up 7%, and received a strong subscription gross margin of nearly 59%, while EBITDA margin was about 27%. The company's balance sheet is healthy, with net cash and minimum debt of more than $77 million, which effectively utilizes "other people's money" to fund operations with the help of a favorable cash conversion cycle. Ituran has about 80% of the market share in Israel and is backed by a government pricing and installer certification monopoly, while Brazil offers growth despite higher margins. Challenges include expensive hardware upgrades to 2G shutdowns and the risks of internalizing services for partners. Nevertheless, Ituran is growing into a high-growth subscription business and accelerates subscriber earnings, operating leverage, and provides a clear path for $100 million EBITDA to position it as potential valuations as the market recognizes its unique growth and resilient cash flow model.