L3Harris Technologies (LHX) AI Stock Analysis

• Market Cap: $53.98B
• Dividend Yield: 1.65%
• Average Volume (3M): 1.12M
• Price to Earnings (P/E): 31.0
• Beta (1Y): 0.54
• Revenue Growth: 2.83%
• EPS Growth: 47.00%
• Country: US
• Employees: 47,000
• Sector: Industrials
• Sector Strength: 72
• Industry: Aerospace & Defense
• EPS (TTM): 2.70
• Shares Outstanding: 187,052,840
• 10 Day Avg. Volume: 1,201,964
• 30 Day Avg. Volume: 1,118,512
• PEG Ratio: 1.19
• Price to Book (P/B): 2.04
• Price to Sales (P/S): 1.87
• P/FCF Ratio: 18.51
• Enterprise Value/Market Cap: 1.25
• Enterprise Value/Revenue: 3.10
• Enterprise Value/Gross Profit: 13.41
• Enterprise Value/Ebitda: 18.04
• 1Y Price Target: $330.63
• Price Target Upside: 14.57% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 9

• Rating: 71 Outperform
• Price Target: $327.00 ▲(13.31% Upside)

L3Harris Technologies' strong financial performance and positive earnings call are the most significant factors driving the stock score. The company shows robust revenue growth and improved profitability, with strategic alignment in the defense sector. However, high debt levels and a relatively high P/E ratio pose risks. Technical indicators suggest moderate momentum, and the valuation indicates potential overvaluation.

Positive Factors

Revenue Growth

The company's ability to exceed revenue expectations indicates strong demand and effective execution, supporting long-term growth prospects.

Strategic Contracts

Securing a $2.26 billion contract with South Korea enhances L3Harris's market position and diversifies its revenue streams, supporting sustainable growth.

Strong Demand

A high book-to-bill ratio reflects strong demand for L3Harris's products, ensuring a robust order pipeline and future revenue stability.

Negative Factors

High Debt Levels

Elevated debt levels can strain financial resources and limit flexibility, potentially impacting long-term financial health if interest rates increase.

Free Cash Flow Decline

A decline in free cash flow growth may limit the company's ability to invest in new opportunities or service debt, affecting future growth.

Government Shutdown Impact

Delays in government funding and awards due to shutdowns can create uncertainty and disrupt cash flow, affecting operational stability.

L3Harris Technologies Business Overview & Revenue Model

Company Description

L3Harris Technologies, Inc., an aerospace and defense technology company, provides mission-critical solutions for government and commercial customers worldwide. The company's Integrated Mission Systems segment provides multi-mission intelligence, surveillance, and reconnaissance (ISR) systems; and communication systems, as well as fleet management support, sensor development, modification, and periodic depot maintenance services for ISR and airborne missions. It also manufactures and integrates mission systems for maritime platforms, such as signals intelligence and multi-intelligence platforms; unmanned surface and undersea autonomous solutions; and power and ship control systems and other electronic and electrical products and systems. In addition, this segment offers advanced electro-optical and infrared solutions. Its Space and Airborne Systems segment offers space payloads, sensors, and full-mission solutions; classified intelligence and cyber defense solutions; mission avionics; and electronic warfare systems. The company's Communication Systems segment provides tactical communications; broadband secured mobile networked communication equipment, including airborne, space, and surface data link terminals, ground stations, and transportable tactical satellite communication (SATCOM) systems for use in manned aircraft, unmanned aerial vehicles, and naval ships; and helmet and weapon mounted integrated night vision systems. This segment also offers radios, systems applications, and equipment for critical public safety and professional communications; and SATCOM terminals and battlefield management networks. Its Aviation Systems segment offers defense aviation products; commercial pilot training; and mission networks solutions for air traffic management. The company was formerly known as Harris Corporation and changed its name to L3Harris Technologies, Inc. in June 2019. L3Harris Technologies, Inc. was founded in 1895 and is headquartered in Melbourne, Florida.

How the Company Makes Money

L3Harris generates revenue through a diversified business model that includes government contracts, commercial sales, and international sales. The majority of its revenue comes from the U.S. Department of Defense and other government agencies, focusing on defense contracts that encompass technology development, equipment manufacturing, and service provisions. Key revenue streams include sales of communication systems, electronic warfare systems, and avionics, as well as support and maintenance services. Additionally, L3Harris has established significant partnerships with various defense organizations and other technology companies, which enhance its capabilities and expand its market reach. The company's ongoing investment in research and development ensures a steady pipeline of innovative products and solutions that help sustain its competitive position in the aerospace and defense sectors.

L3Harris Technologies Financial Statement Overview

Summary

L3Harris Technologies demonstrates strong revenue growth and improved profitability margins, reflecting effective cost management and market demand. The balance sheet shows a healthy equity position, though high debt levels remain a concern. Cash flow generation is robust, but declining free cash flow growth could limit financial flexibility.

Income Statement

L3Harris Technologies shows strong revenue growth with a TTM increase of 59.8%, indicating robust demand in the Aerospace & Defense sector. Gross profit margin remains stable at around 22.3%, while net profit margin improved to 7.9% in the TTM, reflecting enhanced operational efficiency. However, the gross profit margin has decreased from previous years, suggesting potential cost pressures.

Balance Sheet

The company's debt-to-equity ratio has improved to 0.63 in the TTM, indicating a better balance between debt and equity financing. Return on equity is moderate at 8.8%, showing a decent return for shareholders. The equity ratio stands at approximately 46.7%, suggesting a solid equity base. However, the total debt remains high, which could pose risks if interest rates rise.

Cash Flow

Operating cash flow to net income ratio is healthy at 0.36, indicating good cash generation relative to net income. Free cash flow to net income ratio is strong at 0.87, showing efficient cash utilization. However, free cash flow growth has declined by 4.6% in the TTM, which could impact future investments and debt servicing.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	21.74B	21.32B	19.42B	17.06B	17.81B	18.19B
Gross Profit	5.03B	4.75B	4.43B	4.93B	5.38B	5.34B
EBITDA	3.74B	3.56B	2.93B	2.50B	3.52B	2.64B
Net Income	1.76B	1.50B	1.23B	1.06B	1.85B	1.12B
Balance Sheet
Total Assets	41.01B	42.00B	41.69B	33.52B	34.71B	36.96B
Cash, Cash Equivalents and Short-Term Investments	339.00M	615.00M	560.00M	880.00M	941.00M	1.28B
Total Debt	11.84B	12.98B	13.95B	7.79B	7.83B	7.69B
Total Liabilities	21.48B	22.42B	22.86B	14.90B	15.39B	16.12B
Stockholders Equity	19.53B	19.51B	18.77B	18.52B	19.21B	20.72B
Cash Flow
Free Cash Flow	1.89B	2.15B	1.65B	1.91B	2.35B	2.42B
Operating Cash Flow	2.27B	2.56B	2.10B	2.16B	2.69B	2.79B
Investing Cash Flow	425.00M	-263.00M	-7.02B	-250.00M	1.39B	751.00M
Financing Cash Flow	-2.89B	-2.22B	4.59B	-1.95B	-4.41B	-3.11B

L3Harris Technologies Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 288.59
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For LHX, the sentiment is Neutral. The current price of 288.59 is below the 20-day moving average (MA) of 292.37, above the 50-day MA of 286.96, and above the 200-day MA of 244.80, indicating a neutral trend. The MACD of 0.25 indicates Positive momentum. The RSI at 48.26 is Neutral, neither overbought nor oversold. The STOCH value of 38.68 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for LHX.

L3Harris Technologies Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
GD	―	$92.35B	22.16	17.78%	1.73%	11.86%	17.39%
NOC	―	$82.12B	20.66	26.15%	1.52%	-0.14%	72.35%
RTX	―	$237.37B	36.35	10.49%	1.47%	8.79%	39.63%
HII	―	$12.46B	21.94	12.39%	1.88%	2.60%	-18.22%
LHX	―	$53.98B	30.99	9.13%	1.65%	2.83%	47.00%
LMT	―	$113.82B	27.46	62.78%	2.71%	2.88%	-35.15%
Sector *	―	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%

L3Harris Technologies Corporate Events

L3Harris Technologies Reports Strong Q3 2025 Results

L3Harris Technologies, a prominent player in the defense and aerospace sector, specializes in delivering cutting-edge communication, electronic, and space systems, with a focus on innovation and strategic growth.