L3Harris Technologies Faces Recent Struggles Amidst Growing Demand

L3Harris Technologies, Inc. (LHX), with a market capitalization of $39.2 billion, stands as a prominent provider of mission-critical solutions for both government and commercial clients. Operating through four key segments—Space & Airborne Systems, Integrated Mission Systems, Communication Systems, and Aerojet Rocketdyne—the company specializes in advanced technologies that span defense, aerospace, and communication sectors.

Falling within the large-cap stock classification, L3Harris is defined by its valuation of $10 billion or more. Its offerings encompass satellite payloads, tactical radios, ISR systems, propulsion technologies, and public safety communications. Located in Melbourne, Florida, L3Harris is recognized for its continuous innovation in areas including national security, space exploration, and military defense.

Recent Stock Performance and Comparisons

Despite its strong market presence, LHX has experienced a significant downturn, registering a 20.5% decline from its 52-week high of $265.74. Over the last three months, the company’s share price has contracted by 5.3%, a slightly better performance than the Industrial Select Sector SPDR Fund’s (XLI) decline of 6.3% during the same period.

Long-term data indicates that LHX is up marginally year-to-date, outperforming XLI, which has decreased by 2.3%. However, over a year, L3Harris shares have fallen by 2%, trailing behind XLI’s return of 5.1%.

Additionally, LHX has traded below its 50-day and 200-day moving averages since December of the previous year.

Positive Q4 Results and Market Position

On January 30, L3Harris saw a minor recovery as it announced adjusted Q4 2024 earnings of $3.47 per share, surpassing consensus expectations and indicating a year-over-year rise of 3.6%. The company reported revenues of $5.5 billion, which exceeded estimates. This was driven primarily by strong demand for communication equipment, night vision devices, and increased output in Aerojet Rocketdyne. Furthermore, L3Harris announced its 2024 adjusted free cash flow of $2.3 billion, signaling solid growth.

Nonetheless, LHX’s performance lags behind GE Aerospace (GE), which has seen a 15.4% increase year-to-date and a substantial 41.4% rise over the last 52 weeks.

Given LHX’s lackluster performance, analysts remain cautiously optimistic. The stock holds a consensus rating of “Moderate Buy” from 20 different analysts, and currently, LHX is trading below the average price target of $259.91.

On the date of publication, Sohini Mondal did not hold (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article are solely for informational purposes. For more details, please view the Barchart Disclosure Policy here.

The views and opinions expressed herein are those of the author and do not necessarily reflect those of Nasdaq, Inc.