L3Harris (LHX) Stock Forecast & Price Target

L3Harris Technologies demonstrates a robust financial outlook, highlighted by a notable 12% organic sales growth in the Aerojet segment, coupled with impressive adjusted operating margins of 13.3%. The company has raised its 2025 revenue guidance by $100 million for both its IMS and SAS sectors, reflecting strong performance and positive market conditions. Additionally, the increase in free cash flow guidance for FY25 to $2.65 billion, which is 9% above consensus, further underscores the company's solid financial position and operational efficiency.

L3Harris Technologies is facing challenges with a significant dip in operational margins in its SAS segment, which fell by 30 basis points year-over-year, adversely impacted by asset sales and product mix. Additionally, the company's second-quarter results were negatively affected by net EAC adjustments amounting to $15 million, contrasting sharply with no such impact in the prior year, indicating increasing operational inefficiencies. Furthermore, the performance within the Integrated Mission Systems segment has shown a year-over-year decline of 3%, raising concerns regarding the company's growth prospects amid a forecasted softness in its Space segment and potential budget timing risks for 2025.