L3HARRIS TECHNOLOGIES INC (LHX)
US5024311095 - Common Stock
We assign a fundamental rating of 4 out of 10 to LHX. LHX was compared to 65 industry peers in the Aerospace & Defense industry. There are concerns on the financial health of LHX while its profitability can be described as average. LHX has a decent growth rate and is not valued too expensively.
1. Profitability
1.1 Basic Checks
In the past year LHX was profitable.
In the past year LHX had a positive cash flow from operations.
LHX had positive earnings in each of the past 5 years.
In the past 5 years LHX always reported a positive cash flow from operatings.
1.2 Ratios
With a Return On Assets value of 2.88%, LHX perfoms like the industry average, outperforming 52.31% of the companies in the same industry.
LHX has a Return On Equity (6.35%) which is comparable to the rest of the industry.
LHX has a Return On Invested Capital of 6.00%. This is comparable to the rest of the industry: LHX outperforms 56.92% of its industry peers.
The Average Return On Invested Capital over the past 3 years for LHX is in line with the industry average of 7.71%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.88% | ||
| ROE | 6.35% | ||
| ROIC | 6% |
ROA(3y)3.81%
ROA(5y)4.76%
ROE(3y)7.29%
ROE(5y)11.09%
ROIC(3y)6.33%
ROIC(5y)7.4%
1.3 Margins
LHX's Profit Margin of 5.71% is in line compared to the rest of the industry. LHX outperforms 55.38% of its industry peers.
LHX's Profit Margin has declined in the last couple of years.
With a decent Operating Margin value of 10.98%, LHX is doing good in the industry, outperforming 78.46% of the companies in the same industry.
In the last couple of years the Operating Margin of LHX has declined.
LHX has a Gross Margin (26.17%) which is comparable to the rest of the industry.
In the last couple of years the Gross Margin of LHX has declined.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 10.98% | ||
| PM (TTM) | 5.71% | ||
| GM | 26.17% |
OM growth 3Y0.13%
OM growth 5Y-5.87%
PM growth 3Y0.9%
PM growth 5Y-10.98%
GM growth 3Y-3.36%
GM growth 5Y-5.03%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), LHX is destroying value.
The number of shares outstanding for LHX has been reduced compared to 1 year ago.
The number of shares outstanding for LHX has been increased compared to 5 years ago.
The debt/assets ratio for LHX is higher compared to a year ago.
2.2 Solvency
An Altman-Z score of 2.03 indicates that LHX is not a great score, but indicates only limited risk for bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 2.03, LHX is in line with its industry, outperforming 41.54% of the companies in the same industry.
The Debt to FCF ratio of LHX is 7.20, which is on the high side as it means it would take LHX, 7.20 years of fcf income to pay off all of its debts.
LHX has a better Debt to FCF ratio (7.20) than 66.15% of its industry peers.
LHX has a Debt/Equity ratio of 0.65. This is a neutral value indicating LHX is somewhat dependend on debt financing.
Looking at the Debt to Equity ratio, with a value of 0.65, LHX is in line with its industry, outperforming 41.54% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.65 | ||
| Debt/FCF | 7.2 | ||
| Altman-Z | 2.03 |
ROIC/WACC0.68
WACC8.8%
2.3 Liquidity
LHX has a Current Ratio of 1.04. This is a normal value and indicates that LHX is financially healthy and should not expect problems in meeting its short term obligations.
The Current ratio of LHX (1.04) is worse than 78.46% of its industry peers.
LHX has a Quick Ratio of 1.04. This is a bad value and indicates that LHX is not financially healthy enough and could expect problems in meeting its short term obligations.
The Quick ratio of LHX (0.87) is worse than 66.15% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.04 | ||
| Quick Ratio | 0.87 |
3. Growth
3.1 Past
LHX shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 5.70%.
The Earnings Per Share has been growing slightly by 2.25% on average over the past years.
Looking at the last year, LHX shows a quite strong growth in Revenue. The Revenue has grown by 13.32% in the last year.
Measured over the past years, LHX shows a very strong growth in Revenue. The Revenue has been growing by 25.78% on average per year.
EPS 1Y (TTM)5.7%
EPS 3Y2.14%
EPS 5Y2.25%
EPS Q2Q%4.7%
Revenue 1Y (TTM)13.32%
Revenue growth 3Y2.2%
Revenue growth 5Y25.78%
Sales Q2Q%7.67%
3.2 Future
The Earnings Per Share is expected to grow by 8.53% on average over the next years. This is quite good.
The Revenue is expected to grow by 5.93% on average over the next years.
EPS Next Y6.93%
EPS Next 2Y8.39%
EPS Next 3Y9.03%
EPS Next 5Y8.53%
Revenue Next Year9.64%
Revenue Next 2Y6.6%
Revenue Next 3Y6%
Revenue Next 5Y5.93%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 19.07, which indicates a rather expensive current valuation of LHX.
LHX's Price/Earnings ratio is rather cheap when compared to the industry. LHX is cheaper than 87.69% of the companies in the same industry.
When comparing the Price/Earnings ratio of LHX to the average of the S&P500 Index (28.65), we can say LHX is valued slightly cheaper.
A Price/Forward Earnings ratio of 17.04 indicates a rather expensive valuation of LHX.
Based on the Price/Forward Earnings ratio, LHX is valued cheaply inside the industry as 86.15% of the companies are valued more expensively.
The average S&P500 Price/Forward Earnings ratio is at 23.56. LHX is valued slightly cheaper when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.07 | ||
| Fwd PE | 17.04 |
4.2 Price Multiples
LHX's Enterprise Value to EBITDA ratio is a bit cheaper when compared to the industry. LHX is cheaper than 73.85% of the companies in the same industry.
87.69% of the companies in the same industry are more expensive than LHX, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 26.21 | ||
| EV/EBITDA | 15.83 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
PEG (NY)2.75
PEG (5Y)8.48
EPS Next 2Y8.39%
EPS Next 3Y9.03%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 1.87%, LHX has a reasonable but not impressive dividend return.
Compared to an average industry Dividend Yield of 1.49, LHX pays a better dividend. On top of this LHX pays more dividend than 90.77% of the companies listed in the same industry.
LHX's Dividend Yield is comparable with the S&P500 average which is at 2.23.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.87% |
5.2 History
The dividend of LHX is nicely growing with an annual growth rate of 16.34%!
LHX has been paying a dividend for at least 10 years, so it has a reliable track record.
LHX has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)16.34%
Div Incr Years20
Div Non Decr Years23
5.3 Sustainability
72.99% of the earnings are spent on dividend by LHX. This is not a sustainable payout ratio.
LHX's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP72.99%
EPS Next 2Y8.39%
EPS Next 3Y9.03%
L3HARRIS TECHNOLOGIES INC
NYSE:LHX (11/21/2024, 1:07:43 PM)
247.655
+3.29 (+1.35%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryAerospace & Defense
Earnings (Last)
Earnings (Next)
Inst Owners
Inst Owner Change
Ins Owners
Ins Owner Change
Market Cap46.97B
Analysts
Price Target
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.87% |
Dividend Growth(5Y)
DP
Div Incr Years
Div Non Decr Years
Ex-Date
Surprises & Revisions
EPS beat(2)
Avg EPS beat(2)
Min EPS beat(2)
Max EPS beat(2)
EPS beat(4)
Avg EPS beat(4)
Min EPS beat(4)
Max EPS beat(4)
EPS beat(8)
Avg EPS beat(8)
EPS beat(12)
Avg EPS beat(12)
EPS beat(16)
Avg EPS beat(16)
Revenue beat(2)
Avg Revenue beat(2)
Min Revenue beat(2)
Max Revenue beat(2)
Revenue beat(4)
Avg Revenue beat(4)
Min Revenue beat(4)
Max Revenue beat(4)
Revenue beat(8)
Avg Revenue beat(8)
Revenue beat(12)
Avg Revenue beat(12)
Revenue beat(16)
Avg Revenue beat(16)
PT rev (1m)
PT rev (3m)
EPS NQ rev (1m)
EPS NQ rev (3m)
EPS NY rev (1m)
EPS NY rev (3m)
Revenue NQ rev (1m)
Revenue NQ rev (3m)
Revenue NY rev (1m)
Revenue NY rev (3m)
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.07 | ||
| Fwd PE | 17.04 | ||
| P/S | |||
| P/FCF | |||
| P/OCF | |||
| P/B | |||
| P/tB | |||
| EV/EBITDA |
EPS(TTM)
EY
EPS(NY)
Fwd EY
FCF(TTM)
FCFY
OCF(TTM)
OCFY
SpS
BVpS
TBVpS
PEG (NY)2.75
PEG (5Y)8.48
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.88% | ||
| ROE | 6.35% | ||
| ROCE | |||
| ROIC | |||
| ROICexc | |||
| ROICexgc | |||
| OM | 10.98% | ||
| PM (TTM) | 5.71% | ||
| GM | 26.17% | ||
| FCFM |
ROA(3y)
ROA(5y)
ROE(3y)
ROE(5y)
ROIC(3y)
ROIC(5y)
ROICexc(3y)
ROICexc(5y)
ROICexgc(3y)
ROICexgc(5y)
ROCE(3y)
ROCE(5y)
ROICexcg growth 3Y
ROICexcg growth 5Y
ROICexc growth 3Y
ROICexc growth 5Y
OM growth 3Y
OM growth 5Y
PM growth 3Y
PM growth 5Y
GM growth 3Y
GM growth 5Y
F-Score
Asset Turnover0.5
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.65 | ||
| Debt/FCF | |||
| Debt/EBITDA | |||
| Cap/Depr | |||
| Cap/Sales | |||
| Interest Coverage | |||
| Cash Conversion | |||
| Profit Quality | |||
| Current Ratio | 1.04 | ||
| Quick Ratio | 0.87 | ||
| Altman-Z |
F-Score
WACC
ROIC/WACC
Cap/Depr(3y)
Cap/Depr(5y)
Cap/Sales(3y)
Cap/Sales(5y)
Profit Quality(3y)
Profit Quality(5y)
High Growth Momentum
Growth
EPS 1Y (TTM)5.7%
EPS 3Y2.14%
EPS 5Y
EPS Q2Q%
EPS Next Y6.93%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)13.32%
Revenue growth 3Y2.2%
Revenue growth 5Y
Sales Q2Q%
Revenue Next Year
Revenue Next 2Y
Revenue Next 3Y
Revenue Next 5Y
EBIT growth 1Y
EBIT growth 3Y
EBIT growth 5Y
EBIT Next Year
EBIT Next 3Y
EBIT Next 5Y
FCF growth 1Y
FCF growth 3Y
FCF growth 5Y
OCF growth 1Y
OCF growth 3Y
OCF growth 5Y