L3Harris Technologies (LHX) AI Stock Analysis

• Market Cap: $45.46B
• Dividend Yield: 1.93%
• Average Volume (3M): 1.60M
• Price to Earnings (P/E): 28.8
• Beta (1Y): 0.64
• Revenue Growth: 5.39%
• EPS Growth: 36.86%
• Country: US
• Employees: 47,000
• Sector: Industrials
• Sector Strength: 93
• Industry: Aerospace & Defense
• EPS (TTM): 2.41
• Shares Outstanding: 186,945,630
• 10 Day Avg. Volume: 1,985,628
• 30 Day Avg. Volume: 1,600,650
• PEG Ratio: N/A
• Price to Book (P/B): 2.27
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 18.97
• Enterprise Value/Market Cap: 1.20
• Enterprise Value/Revenue: 0.65
• Enterprise Value/Gross Profit: 10.67
• Enterprise Value/Ebitda: 3.59
• 1Y Price Target: $251.00
• Price Target Upside: 3.69% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 14

• Rating: 76 Outperform
• Price Target: $273.00 ▲(12.78%Upside)

L3Harris Technologies' overall stock score is driven by its strong financial performance and positive technical indicators, suggesting a solid foundation and potential for growth. While the valuation suggests the stock may be overvalued, the company's strategic initiatives and positive earnings call sentiment provide a supportive outlook for sustained growth.

Positive Factors

Financial Strategy

Proceeds from the sale of Commercial Aviation Solutions are expected to re-accelerate stock repurchases, with a baseline of $1 billion planned.

Military Contracts and Investments

LHX capabilities in secure communications, space-based operations, and missile programs should continue to benefit from emphasis and investment by US and allied militaries.

Partnerships and Innovation

Developing partnerships with defense tech entrants is seen as an indicator of the company’s dedication to innovation and agility.

Negative Factors

International Sales

The percentage of revenue from international sales decreased slightly, which may suggest challenges in global market expansion.

Operating Margins

Segment operating margins are expected to decline, particularly for Aerojet, due to productivity issues.

Revenue Impact

The sale of Commercial Aviation Solutions is expected to remove $480 million from L3Harris Technologies' 2025 revenue estimates.

L3Harris Technologies Business Overview & Revenue Model

Company Description

L3Harris Technologies (LHX) is a leading American technology company specializing in defense and aerospace systems. Formed from the merger of L3 Technologies and Harris Corporation in 2019, the company operates in various sectors including communication, electronic, and avionics systems. L3Harris provides advanced solutions for government, defense, and commercial customers worldwide, focusing on secure communications, electronic warfare, avionics, and space systems.

How the Company Makes Money

L3Harris Technologies generates revenue primarily through the sale of its diverse portfolio of defense and aerospace products and services. The company earns income by fulfilling contracts with government agencies such as the U.S. Department of Defense and other allied nations, providing mission-critical systems and solutions. These include communication systems, avionics, and ISR (Intelligence, Surveillance, and Reconnaissance) systems. Additionally, L3Harris leverages technology development and system integration capabilities to offer innovative solutions that enhance military operations and commercial aviation. The company's revenue model is supported by long-term contracts, research and development investments, and strategic partnerships with other defense contractors and organizations that expand its reach and capabilities.

L3Harris Technologies Financial Statement Overview

Summary

L3Harris Technologies demonstrates strong financial health with robust profitability metrics and stable growth. A solid income statement with healthy margins, a stable balance sheet with low leverage, and strong cash flow conversion indicate efficient financial management. Overall, the financial performance suggests a resilient foundation for future growth.

Income Statement

L3Harris Technologies shows a strong financial performance with a solid gross profit margin of 25.1% and a net profit margin of 7.9% for TTM (Trailing-Twelve-Months). The revenue growth rate from the previous fiscal year to TTM is approximately 9.4%, indicating robust growth. EBIT and EBITDA margins are healthy at 9.9% and 15.8%, respectively, reflecting efficient core operations.

Balance Sheet

The company maintains a stable financial position with a debt-to-equity ratio of 0.067 for TTM, indicating low leverage. ROE stands at 8.8%, showcasing moderate profitability for shareholders. The equity ratio is 46.4%, highlighting a balanced capital structure with reasonable reliance on equity financing.

Cash Flow

Cash flow metrics are strong, with a free cash flow growth rate of 5.5% from the previous fiscal year to TTM. The operating cash flow to net income ratio of 1.56 indicates adequate cash generation relative to net earnings. Similarly, the free cash flow to net income ratio is 1.35, suggesting efficient conversion of profits into cash.

Breakdown
Mar 2025	Dec 2023	Dec 2022	Dec 2021	Mar 2021
Income Statement		Total Revenue
21.32B	19.42B	17.06B	17.81B	18.19B
	Gross Profit
5.52B	5.11B	4.93B	5.38B	5.31B
	EBIT
1.92B	1.43B	2.37B	2.56B	2.39B
	EBITDA
3.56B	2.93B	2.50B	3.52B	2.64B
	Net Income Common Stockholders
1.50B	1.23B	1.06B	1.85B	1.12B
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
615.00M	560.00M	880.00M	941.00M	1.28B
	Total Assets
42.00B	41.69B	33.52B	34.71B	36.96B
	Total Debt
12.24B	13.95B	7.79B	7.83B	7.69B
	Net Debt
11.62B	13.39B	6.91B	6.89B	6.41B
	Total Liabilities
22.42B	22.86B	14.90B	15.39B	16.12B
	Stockholders Equity
19.51B	18.77B	18.52B	19.21B	20.72B
Cash Flow		Free Cash Flow
2.15B	1.65B	1.91B	2.35B	2.42B
	Operating Cash Flow
2.56B	2.10B	2.16B	2.69B	2.79B
	Investing Cash Flow
-263.00M	-7.02B	-250.00M	1.39B	751.00M
	Financing Cash Flow
-2.22B	4.59B	-1.95B	-4.41B	-3.11B

L3Harris Technologies Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 242.06
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For LHX, the sentiment is Positive. The current price of 242.06 is above the 20-day moving average (MA) of 232.71, above the 50-day MA of 221.19, and above the 200-day MA of 223.30, indicating a bullish trend. The MACD of 6.92 indicates Negative momentum. The RSI at 69.28 is Neutral, neither overbought nor oversold. The STOCH value of 57.45 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for LHX.

L3Harris Technologies Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
GD	79 Outperform	$74.09B	19.16	18.23%	2.09%	14.11%	17.65%
LMT	77 Outperform	$112.50B	20.74	82.55%	2.67%	3.12%	-15.29%
AXON	76 Outperform	$59.09B	188.80	15.13%	―	32.48%	24.29%
LHX	76 Outperform	$45.46B	28.82	8.49%	1.93%	5.39%	36.86%
TDG	75 Outperform	$81.78B	48.92	-29.16%	―	14.90%	17.50%
NOC	74 Outperform	$70.27B	19.22	25.41%	1.68%	0.61%	77.28%
Sector *	66 Neutral	$4.49B	12.28	5.32%	248.53%	4.08%	-12.00%

L3Harris Technologies Corporate Events

L3Harris Technologies Secures New Credit Facilities

On February 18, 2025, L3Harris Technologies announced the establishment of a new $2.5 billion five-year senior unsecured revolving credit facility, replacing a previous $2 billion facility. This move enhances L3Harris’ financial flexibility, allowing it to borrow, prepay, and re-borrow funds, with certain subsidiaries designated as borrowers. Concurrently, L3Harris set up a new $500 million 364-day credit facility, replacing a prior $1.5 billion facility. These developments demonstrate L3Harris’ strategic financial adjustments to support its operations and maintain favorable terms based on its senior debt ratings.