JERUSALEM, May 28 (Reuters) - Israeli defence

electronics firm Elbit Systems reported

higher first-quarter sales and earnings on Tuesday on strong

wartime demand and said it would hit a $7 billion sales target

ahead of schedule.

Elbit, one of Israel's largest defence contractors, supplies

products ranging from drones to training simulators, artillery

fire control systems and surveillance equipment and has seen

orders surge amid a rise in defence spending worldwide.

The company predicts it will meet its revenue target earlier

than expected, Chief Executive Bezhalel Machlis said.

"Our internal goal was to reach $7 billion by 2026," Machlis

told Reuters. "I can tell you it will be much earlier."

Although Elbit has benefited from strong demand due to

global insecurity, its shares have been under pressure on

investor concerns over the war in Gaza and a wave of global

protests aimed at pressuring big institutions to cut investments

in Israel.

Elbit shares fell 3% on the Nasdaq, adding to a 10% decline

this year, despite pressure on governments to increase defence

spending to respond to increased security threats linked to the

war in Ukraine, or tensions with Iran.

"There's no real justification for the shares to drop as

much as they did because the results are good, we saw that in

the first quarter results," said Liran Lublin, head of research

at IBI Investment House in Tel Aviv.

"I think it's more of an Israeli related issue with foreign

investors selling Israeli stocks, I don't think it's just an

Elbit Systems issue."

Earlier this month, an asset manager owned by Canadian

lender Bank of Nova Scotia (BNS.TO) nearly halved its stake in

the weapons manufacturer after protests demanding the fund

manager cut its exposure.

The company has been boosted by an increasingly uncertain

global security environment, with more interest from

international clients since the start of the war in Gaza,

Machlis said.

When Iran launched a barrage of hundreds of missiles against

Israel in April, Elbit's "Citron Tree" and "Golden Almond"

technologies formed a central part of the air defence systems

that shot down almost all of the missiles.

"The fact that our systems are in operational use in Israel

helps us because customers prefer to get mature solutions," he

told Reuters.

In its first quarter report, Elbit said some operations had

been disrupted due to supply chain issues and staff shortages

due to mobilization but most operations had continued

uninterrupted.