L3HARRIS TECHNOLOGIES INC (LHX) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:LHX - US5024311095 - Common Stock
354.73 USD
-1.02 (-0.29%)
358 USD
+3.27 (+0.92%)
LHX gets a fundamental rating of 4 out of 10. The analysis compared the fundamentals against 73 industry peers in the Aerospace & Defense industry. LHX has a medium profitability rating, but doesn't score so well on its financial health evaluation. LHX is not valued too expensively and it also shows a decent growth rate.
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.
- LHX had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
- With a decent Return On Assets value of 4.29%, LHX is doing good in the industry, outperforming 65.75% of the companies in the same industry.
- LHX's Return On Equity of 9.01% is fine compared to the rest of the industry. LHX outperforms 64.38% of its industry peers.
- LHX's Return On Invested Capital of 5.62% is in line compared to the rest of the industry. LHX outperforms 50.68% of its industry peers.
- LHX had an Average Return On Invested Capital over the past 3 years of 5.34%. This is below the industry average of 8.56%.
- The last Return On Invested Capital (5.62%) for LHX is above the 3 year average (5.34%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.29% | ||
| ROE | 9.01% | ||
| ROIC | 5.62% |
ROA(3y)3.23%
ROA(5y)3.61%
ROE(3y)6.66%
ROE(5y)7%
ROIC(3y)5.34%
ROIC(5y)5.33%
1.3 Margins
- LHX's Profit Margin of 8.09% is fine compared to the rest of the industry. LHX outperforms 71.23% of its industry peers.
- LHX's Profit Margin has declined in the last couple of years.
- LHX has a Operating Margin of 11.49%. This is in the better half of the industry: LHX outperforms 76.71% of its industry peers.
- LHX's Operating Margin has declined in the last couple of years.
- LHX has a Gross Margin of 25.65%. This is comparable to the rest of the industry: LHX outperforms 53.42% of its industry peers.
- LHX's Gross Margin has declined in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 11.49% | ||
| PM (TTM) | 8.09% | ||
| GM | 25.65% |
OM growth 3Y-4.16%
OM growth 5Y-7.3%
PM growth 3Y-12.08%
PM growth 5Y-12.74%
GM growth 3Y-4.96%
GM growth 5Y-5.47%
2. Health
2.1 Basic Checks
- The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so LHX is destroying value.
- LHX has about the same amout of shares outstanding than it did 1 year ago.
- LHX has more shares outstanding than it did 5 years ago.
- The debt/assets ratio for LHX has been reduced compared to a year ago.
2.2 Solvency
- An Altman-Z score of 2.76 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 2.76, LHX is doing worse than 61.64% of the companies in the same industry.
- LHX has a debt to FCF ratio of 6.21. This is a slightly negative value and a sign of low solvency as LHX would need 6.21 years to pay back of all of its debts.
- LHX has a Debt to FCF ratio of 6.21. This is in the better half of the industry: LHX outperforms 64.38% of its industry peers.
- A Debt/Equity ratio of 0.60 indicates that LHX is somewhat dependend on debt financing.
- LHX's Debt to Equity ratio of 0.60 is on the low side compared to the rest of the industry. LHX is outperformed by 63.01% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.6 | ||
| Debt/FCF | 6.21 | ||
| Altman-Z | 2.76 |
ROIC/WACC0.58
WACC9.62%
2.3 Liquidity
- LHX has a Current Ratio of 1.14. This is a normal value and indicates that LHX is financially healthy and should not expect problems in meeting its short term obligations.
- LHX has a worse Current ratio (1.14) than 80.82% of its industry peers.
- LHX has a Quick Ratio of 1.14. This is a bad value and indicates that LHX is not financially healthy enough and could expect problems in meeting its short term obligations.
- LHX has a Quick ratio of 0.95. This is in the lower half of the industry: LHX underperforms 75.34% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.14 | ||
| Quick Ratio | 0.95 |
3. Growth
3.1 Past
- The earnings per share for LHX have decreased strongly by -12.55% in the last year.
- Measured over the past 5 years, LHX shows a small growth in Earnings Per Share. The EPS has been growing by 0.14% on average per year.
- LHX shows a small growth in Revenue. In the last year, the Revenue has grown by 2.83%.
- The Revenue has been growing by 25.68% on average over the past years. This is a very strong growth!
EPS 1Y (TTM)-12.55%
EPS 3Y0.41%
EPS 5Y0.14%
EPS Q2Q%-19.16%
Revenue 1Y (TTM)2.83%
Revenue growth 3Y6.18%
Revenue growth 5Y25.68%
Sales Q2Q%6.93%
3.2 Future
- The Earnings Per Share is expected to grow by 9.01% on average over the next years. This is quite good.
- The Revenue is expected to grow by 5.18% on average over the next years.
EPS Next Y-17.85%
EPS Next 2Y-2.21%
EPS Next 3Y3.66%
EPS Next 5Y9.01%
Revenue Next Year3.17%
Revenue Next 2Y4.59%
Revenue Next 3Y5.06%
Revenue Next 5Y5.18%
3.3 Evolution
- The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
- 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
- With a Price/Earnings ratio of 31.23, LHX can be considered very expensive at the moment.
- Based on the Price/Earnings ratio, LHX is valued cheaply inside the industry as 80.82% of the companies are valued more expensively.
- LHX is valuated at similar levels of the S&P average when we compare the Price/Earnings ratio to 27.21, which is the current average of the S&P500 Index.
- The Price/Forward Earnings ratio is 28.29, which means the current valuation is very expensive for LHX.
- Based on the Price/Forward Earnings ratio, LHX is valued cheaper than 82.19% of the companies in the same industry.
- Compared to an average S&P500 Price/Forward Earnings ratio of 24.26, LHX is valued at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 31.23 | ||
| Fwd PE | 28.29 |
4.2 Price Multiples
- 73.97% of the companies in the same industry are more expensive than LHX, based on the Enterprise Value to EBITDA ratio.
- Compared to the rest of the industry, the Price/Free Cash Flow ratio of LHX indicates a rather cheap valuation: LHX is cheaper than 86.30% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 35.13 | ||
| EV/EBITDA | 20.74 |
4.3 Compensation for Growth
PEG (NY)N/A
PEG (5Y)217.49
EPS Next 2Y-2.21%
EPS Next 3Y3.66%
5. Dividend
5.1 Amount
- LHX has a Yearly Dividend Yield of 1.35%. Purely for dividend investing, there may be better candidates out there.
- LHX's Dividend Yield is rather good when compared to the industry average which is at 0.34. LHX pays more dividend than 93.15% of the companies in the same industry.
- Compared to the average S&P500 Dividend Yield of 1.81, LHX is paying slightly less dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.35% |
5.2 History
- LHX has been paying a dividend for at least 10 years, so it has a reliable track record.
- LHX has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)N/A
Div Incr Years21
Div Non Decr Years24
5.3 Sustainability
- LHX pays out 51.11% of its income as dividend. This is a bit on the high side, but may be sustainable.
DP51.11%
EPS Next 2Y-2.21%
EPS Next 3Y3.66%
L3HARRIS TECHNOLOGIES INC / LHX FAQ
What is the ChartMill fundamental rating of L3HARRIS TECHNOLOGIES INC (LHX) stock?
ChartMill assigns a fundamental rating of 4 / 10 to LHX.
Can you provide the valuation status for L3HARRIS TECHNOLOGIES INC?
ChartMill assigns a valuation rating of 4 / 10 to L3HARRIS TECHNOLOGIES INC (LHX). This can be considered as Fairly Valued.
How profitable is L3HARRIS TECHNOLOGIES INC (LHX) stock?
L3HARRIS TECHNOLOGIES INC (LHX) has a profitability rating of 5 / 10.
Can you provide the PE and PB ratios for LHX stock?
The Price/Earnings (PE) ratio for L3HARRIS TECHNOLOGIES INC (LHX) is 31.23 and the Price/Book (PB) ratio is 3.4.
Is the dividend of L3HARRIS TECHNOLOGIES INC sustainable?
The dividend rating of L3HARRIS TECHNOLOGIES INC (LHX) is 5 / 10 and the dividend payout ratio is 51.11%.