L3Harris Technologies, Inc.
Industrials · Aerospace & Defense
Structural: #6 US defense prime by revenue (~$21B), but the only pure-play exposure to three high-growth subsegments - tactical radios (Falcon series, ~70% US Army share), resilient space payloads (missile-warning, OPIR, SDA Tranche), and solid rocket motors (sole-source for Javelin, Stinger, GMLRS, PAC-3, Standard Missile via Aerojet).
6x revenue, with multi-year missile-replenishment funding locked in FY25-FY27 DoD budgets.
Aerojet integration unlocks vertical pricing on SRMs into a structurally supply-constrained market - $LMT, $RTX, $NOC have no alternative supplier at scale. SDA proliferated-LEO contracts (Tranche 1/2 Tracking, Transport) make LHX the #2 space prime behind $LMT.
Tactical radio refresh cycle (HMS Manpack, Leader Radio) is mid-replacement, ~5yr tailwind. Margins inflecting as Aerojet hits 12% segment EBIT vs ~6% at acquisition.
~77% revenue is US government, half DoD - CR risk + post-election budget reset. Aerojet integration still leaks (FY24 charges $400M+), and SRM capacity buildout requires capex without certain volume offtake. Trades ~21x fwd vs $LMT/$NOC/$GD at 19-22x - premium needs Aerojet margin proof.
Tactical radio TAM saturating as Army modernization shifts to networking/EW software.
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