L3Harris pentagon investment a potential ‘win-win-win,’ says Morgan Stanley

Morgan Stanley analyst Kristine Liwag reiterated an Overweight rating and $367 price target on L3Harrris after the company announced the creation of a new missile solutions company, adding that it will pursue an IPO of the unit in 2H26. Additionally, the Department of War plans to invest roughly $1B in the company, converting to common equity post the planned separation, the analyst tells investors in a research note. The firm sees this investment structure as attractive to multiple stakeholders, including L3Harris shareholders, the U.S. government, and American taxpayers, and offering a potentially repeatable playbook for other Primes.