UBS initiated coverage of L3Harris Technologies with a Neutral rating and $200 price target. The global prioritization of national security has structurally changed and will lead to continued growth in defense spend, the analyst tells investors in a research note. L3Harris has exposure to multiple fast-growing areas of the budget like Space, while offering peer-high 15% segment EBIT margins and double digit free cash flow to revenue conversion, the firm added. UBS notes however that the company’s results have been choppy and could remain lumpy as recent acquisitions integrate.
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