L3Harris Technologies (LHX): Gauging Valuation as Pentagon Spurs Missile Production Surge

Recent reports that the Pentagon is urging a major ramp-up in missile production have energized the defense sector. L3Harris Technologies (LHX) is among the companies seeing renewed interest as investors weigh the potential demand surge.

See our latest analysis for L3Harris Technologies.

After months of modest movement, L3Harris Technologies’ share price has surged higher, with momentum accelerating as defense spending takes center stage and investors respond to brighter growth prospects. The company’s 1-year total shareholder return sits near 24%, reflecting renewed confidence in both its strategy and the broader sector.

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But with shares up nearly 18% in three months and optimism running high, the question remains: Is L3Harris Technologies still undervalued, or has the market already priced in its next stage of growth?

Most Popular Narrative: 1.7% Undervalued

L3Harris Technologies closed at $297.39, while the most widely followed narrative pegs its fair value at $302.58. This proximity points to a market that is delicately weighing upside potential against sector risk as momentum builds.

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.

Want to know what’s fueling expectations for L3Harris’s next phase? The narrative hinges on bold growth assumptions and a future profit multiple usually reserved for sector leaders. Curious about the projections that unlock this valuation? Find out what makes this consensus price target tick.

Result: Fair Value of $302.58 (UNDERVALUED)

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

However, reliance on outside contractors and potential U.S. budget constraints could quickly erode the bullish growth outlook for L3Harris Technologies.

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

Build Your Own L3Harris Technologies Narrative

If you see things differently or would rather follow your own path, you can dig into the numbers and craft your own perspective in just a few minutes, 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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