L3Harris Technologies: Evaluating Valuation Following Strong Q3 and Nine-Month Results

L3Harris Technologies announced its third quarter and nine-month results, showing increases in sales, net income, and earnings per share compared to a year ago. These numbers could be catching the eye of investors.

See our latest analysis for L3Harris Technologies.

L3Harris Technologies' recent earnings beat and successful share buyback program have coincided with positive momentum in its share price, now at $290.66. The stock’s 40.2% year-to-date share price return signals fresh investor confidence. In addition, a 13.7% total shareholder return over the past year shows solid longer-term rewards.

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Yet with the stock trading close to its all-time highs and analysts’ targets still above the current price, investors have to ask whether L3Harris is undervalued or if the market has already taken all its future growth into account.

Most Popular Narrative: 13% Undervalued

With a fair value estimate of $334.28 compared to the latest close of $290.66, the most widely followed narrative sets expectations for meaningful upside if its forecasts play out. The discount rate guiding these projections is 7.8%, based on sector and company-specific risks.

The U.S. defense budget is expected to grow, with new defense initiatives and a potential increase in funding that could benefit L3Harris, supporting revenue growth. L3Harris is well-positioned in several key growth areas, such as missile warning and tracking, due to recent investments and capability alignment, likely increasing future revenue.

Read the complete narrative.

What’s behind this ambitious price target? Deep within the narrative are assumptions about sustained revenue growth and an earnings climb, plus a profit margin leap and a future valuation multiple once reserved for industry stars. All the moving pieces boil down to a standout number for L3Harris, but the details will surprise you.

Result: Fair Value of $334.28 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, delays in contract awards or shifts in government spending priorities could quickly alter L3Harris Technologies’ current growth trajectory and valuation outlook.

Find out about the key risks to this L3Harris Technologies narrative.

Build Your Own L3Harris Technologies Narrative

Prefer to dig into the numbers yourself or think you have a different perspective? You can shape your own view in just a few minutes, so why not Do it your way

A great starting point for your L3Harris Technologies research is our analysis highlighting 4 key rewards and 1 important warning sign that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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