L3HARRIS TECHNOLOGIES INC (LHX) Stock Fundamental Analysis
NYSE:LHX - New York Stock Exchange, Inc. - US5024311095 - Common Stock - Currency: USD
LHX gets a fundamental rating of 5 out of 10. The analysis compared the fundamentals against 64 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 has a correct valuation and a medium growth rate.
1. Profitability
1.1 Basic Checks
In the past year LHX was profitable.
LHX had a positive operating cash flow in the past year.
Each year in the past 5 years LHX has been profitable.
In the past 5 years LHX always reported a positive cash flow from operatings.
1.2 Ratios
Looking at the Return On Assets, with a value of 3.89%, LHX is in line with its industry, outperforming 57.81% of the companies in the same industry.
Looking at the Return On Equity, with a value of 8.39%, LHX is in the better half of the industry, outperforming 62.50% of the companies in the same industry.
The Return On Invested Capital of LHX (5.51%) is comparable to the rest of the industry.
Measured over the past 3 years, the Average Return On Invested Capital for LHX is below the industry average of 7.94%.
The last Return On Invested Capital (5.51%) for LHX is above the 3 year average (5.34%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.89% | ||
| ROE | 8.39% | ||
| ROIC | 5.51% |
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 has a better Profit Margin (7.55%) than 70.31% of its industry peers.
In the last couple of years the Profit Margin of LHX has declined.
LHX has a Operating Margin of 11.26%. This is in the better half of the industry: LHX outperforms 71.88% of its industry peers.
LHX's Operating Margin has declined in the last couple of years.
LHX has a Gross Margin of 26.01%. This is comparable to the rest of the industry: LHX outperforms 54.69% of its industry peers.
LHX's Gross Margin has declined in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 11.26% | ||
| PM (TTM) | 7.55% | ||
| GM | 26.01% |
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.
Compared to 1 year ago, LHX has about the same amount of shares outstanding.
LHX has more shares outstanding than it did 5 years ago.
LHX has a better debt/assets ratio than last year.
2.2 Solvency
An Altman-Z score of 2.01 indicates that LHX is not a great score, but indicates only limited risk for bankruptcy at the moment.
LHX has a Altman-Z score of 2.01. This is in the lower half of the industry: LHX underperforms 68.75% of its industry peers.
LHX has a debt to FCF ratio of 5.40. This is a neutral value as LHX would need 5.40 years to pay back of all of its debts.
The Debt to FCF ratio of LHX (5.40) is better than 71.88% of its industry peers.
A Debt/Equity ratio of 0.60 indicates that LHX is somewhat dependend on debt financing.
LHX has a Debt to Equity ratio (0.60) which is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.6 | ||
| Debt/FCF | 5.4 | ||
| Altman-Z | 2.01 |
ROIC/WACC0.56
WACC9.82%
2.3 Liquidity
LHX has a Current Ratio of 1.02. This is a normal value and indicates that LHX is financially healthy and should not expect problems in meeting its short term obligations.
LHX's Current ratio of 1.02 is on the low side compared to the rest of the industry. LHX is outperformed by 87.50% of its industry peers.
LHX has a Quick Ratio of 1.02. 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 0.85. This is in the lower half of the industry: LHX underperforms 73.44% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.02 | ||
| Quick Ratio | 0.85 |
3. Growth
3.1 Past
The earnings per share for LHX have decreased by -0.88% in the last year.
The Earnings Per Share has been growing slightly by 0.14% on average over the past years.
Looking at the last year, LHX shows a small growth in Revenue. The Revenue has grown by 5.39% in the last year.
LHX shows a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 25.68% yearly.
EPS 1Y (TTM)-0.88%
EPS 3Y0.41%
EPS 5Y0.14%
EPS Q2Q%-21.24%
Revenue 1Y (TTM)5.39%
Revenue growth 3Y6.18%
Revenue growth 5Y25.68%
Sales Q2Q%-1.52%
3.2 Future
The Earnings Per Share is expected to grow by 6.73% on average over the next years.
Based on estimates for the next years, LHX will show a small growth in Revenue. The Revenue will grow by 4.79% on average per year.
EPS Next Y-19.25%
EPS Next 2Y-3.29%
EPS Next 3Y1.91%
EPS Next 5Y6.73%
Revenue Next Year1.19%
Revenue Next 2Y3.27%
Revenue Next 3Y3.76%
Revenue Next 5Y4.79%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 18.52, LHX is valued on the expensive side.
Based on the Price/Earnings ratio, LHX is valued cheaper than 84.38% of the companies in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 26.60, LHX is valued a bit cheaper.
LHX is valuated rather expensively with a Price/Forward Earnings ratio of 18.83.
Compared to the rest of the industry, the Price/Forward Earnings ratio of LHX indicates a rather cheap valuation: LHX is cheaper than 81.25% of the companies listed in the same industry.
LHX is valuated at similar levels of the S&P average when we compare the Price/Forward Earnings ratio to 22.43, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 18.52 | ||
| Fwd PE | 18.83 |
4.2 Price Multiples
76.56% of the companies in the same industry are more expensive than LHX, based on the Enterprise Value to EBITDA ratio.
93.75% 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 | 19.02 | ||
| EV/EBITDA | 14.85 |
4.3 Compensation for Growth
PEG (NY)N/A
PEG (5Y)129.02
EPS Next 2Y-3.29%
EPS Next 3Y1.91%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 2.12%, LHX has a reasonable but not impressive dividend return.
Compared to an average industry Dividend Yield of 1.34, LHX pays a better dividend. On top of this LHX pays more dividend than 92.19% of the companies listed in the same industry.
Compared to an average S&P500 Dividend Yield of 2.36, LHX has a dividend comparable with the average S&P500 company.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.12% |
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 their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)16.34%
Div Incr Years21
Div Non Decr Years24
5.3 Sustainability
55.45% of the earnings are spent on dividend by LHX. This is a bit on the high side, but may be sustainable.
The dividend of LHX is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP55.45%
EPS Next 2Y-3.29%
EPS Next 3Y1.91%
230.82
-0.15 (-0.06%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryAerospace & Defense
Earnings (Last)
Earnings (Next)
Inst Owners87.74%
Inst Owner Change0.82%
Ins Owners0.31%
Ins Owner Change3.86%
Market Cap43.15B
Analysts80
Price Target262.66 (13.79%)
Short Float %2.04%
Short Ratio2.61
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.12% |
Yearly Dividend4.56
Dividend Growth(5Y)16.34%
DP55.45%
Div Incr Years21
Div Non Decr Years24
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)1.75%
Min EPS beat(2)0.54%
Max EPS beat(2)2.95%
EPS beat(4)4
Avg EPS beat(4)1.49%
Min EPS beat(4)0.54%
Max EPS beat(4)2.95%
EPS beat(8)7
Avg EPS beat(8)1.83%
EPS beat(12)8
Avg EPS beat(12)0.77%
EPS beat(16)11
Avg EPS beat(16)0.76%
Revenue beat(2)0
Avg Revenue beat(2)-1.61%
Min Revenue beat(2)-2.6%
Max Revenue beat(2)-0.63%
Revenue beat(4)0
Avg Revenue beat(4)-1.24%
Min Revenue beat(4)-2.6%
Max Revenue beat(4)-0.63%
Revenue beat(8)3
Avg Revenue beat(8)0.57%
Revenue beat(12)5
Avg Revenue beat(12)0.45%
Revenue beat(16)5
Avg Revenue beat(16)-0.49%
PT rev (1m)1.6%
PT rev (3m)-2.63%
EPS NQ rev (1m)-3.59%
EPS NQ rev (3m)-6.04%
EPS NY rev (1m)-1.28%
EPS NY rev (3m)-4.16%
Revenue NQ rev (1m)-2.74%
Revenue NQ rev (3m)-3.14%
Revenue NY rev (1m)-1.93%
Revenue NY rev (3m)-2.17%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 18.52 | ||
| Fwd PE | 18.83 | ||
| P/S | 2.03 | ||
| P/FCF | 19.02 | ||
| P/OCF | 16.46 | ||
| P/B | 2.26 | ||
| P/tB | N/A | ||
| EV/EBITDA | 14.85 |
EPS(TTM)12.46
EY5.4%
EPS(NY)12.26
Fwd EY5.31%
FCF(TTM)12.14
FCFY5.26%
OCF(TTM)14.02
OCFY6.07%
SpS113.65
BVpS102.33
TBVpS-46.29
PEG (NY)N/A
PEG (5Y)129.02
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.89% | ||
| ROE | 8.39% | ||
| ROCE | 7.08% | ||
| ROIC | 5.51% | ||
| ROICexc | 5.59% | ||
| ROICexgc | 31.34% | ||
| OM | 11.26% | ||
| PM (TTM) | 7.55% | ||
| GM | 26.01% | ||
| FCFM | 10.68% |
ROA(3y)3.23%
ROA(5y)3.61%
ROE(3y)6.66%
ROE(5y)7%
ROIC(3y)5.34%
ROIC(5y)5.33%
ROICexc(3y)5.46%
ROICexc(5y)5.48%
ROICexgc(3y)34.15%
ROICexgc(5y)35.26%
ROCE(3y)6.89%
ROCE(5y)6.83%
ROICexcg growth 3Y-9.8%
ROICexcg growth 5Y-16.22%
ROICexc growth 3Y-3.5%
ROICexc growth 5Y-14.2%
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%
F-Score8
Asset Turnover0.52
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.6 | ||
| Debt/FCF | 5.4 | ||
| Debt/EBITDA | 3.14 | ||
| Cap/Depr | 27.72% | ||
| Cap/Sales | 1.66% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 71.55% | ||
| Profit Quality | 141.37% | ||
| Current Ratio | 1.02 | ||
| Quick Ratio | 0.85 | ||
| Altman-Z | 2.01 |
F-Score8
WACC9.82%
ROIC/WACC0.56
Cap/Depr(3y)32.34%
Cap/Depr(5y)33.61%
Cap/Sales(3y)1.9%
Cap/Sales(5y)1.93%
Profit Quality(3y)152.3%
Profit Quality(5y)160.08%
High Growth Momentum
Growth
EPS 1Y (TTM)-0.88%
EPS 3Y0.41%
EPS 5Y0.14%
EPS Q2Q%-21.24%
EPS Next Y-19.25%
EPS Next 2Y-3.29%
EPS Next 3Y1.91%
EPS Next 5Y6.73%
Revenue 1Y (TTM)5.39%
Revenue growth 3Y6.18%
Revenue growth 5Y25.68%
Sales Q2Q%-1.52%
Revenue Next Year1.19%
Revenue Next 2Y3.27%
Revenue Next 3Y3.76%
Revenue Next 5Y4.79%
EBIT growth 1Y8.23%
EBIT growth 3Y1.77%
EBIT growth 5Y16.51%
EBIT Next Year29.76%
EBIT Next 3Y12.84%
EBIT Next 5Y5.16%
FCF growth 1Y3.09%
FCF growth 3Y-2.84%
FCF growth 5Y16%
OCF growth 1Y6.16%
OCF growth 3Y-1.61%
OCF growth 5Y16.65%