The modern defense landscape is shaped by rapidly evolving threats, expanding digital battlefields, and the growing importance of secure communications across air, land, sea, space, and cyber domains. Long before today’s focus on integrated surveillance, intelligence, and broadband communications, a foundation was being built around advanced electronics, mission-critical equipment, and trusted government relationships. That foundation ultimately gave rise to a company designed to operate at the core of national security infrastructure, where reliability, scale, and technological depth are not optional but essential.
L3Harris Technologies Inc. (NYSE:LHX) was formally created in 2019 through the merger of Harris Corporation and L3 Technologies, combining two long-established defense businesses with complementary strengths. Harris Corporation, founded in 1895, brought deep expertise in communications systems, tactical radios, and secure broadband communications, while L3 Technologies contributed a strong portfolio in surveillance systems, sensors, reconnaissance, and integrated mission systems. Headquartered in Florida, the newly formed L3Harris Technologies Inc was positioned as a diversified defense and technology company capable of delivering integrated solutions across multiple domains for government and military customers.
From its earliest days, L3Harris Technologies Inc focused on providing mission-critical communications and intelligence capabilities to address increasingly complex national security challenges. The company’s background is closely tied to long-term defense contracts with the U.S. Department of Defense and allied governments, supplying equipment and systems used in airborne systems, land-based operations, maritime environments, and space missions. Its portfolio spans communications devices, power systems, sensors, surveillance technologies, and space propulsion, all designed to operate in contested and high-risk environments, including densely populated civilian areas where precision and reliability are paramount.
L3Harris Technologies Inc built its reputation as a trusted disruptor within the defense industry by emphasizing integration rather than standalone products. Instead of offering isolated devices, the company focused on combining communications, intelligence, surveillance, and reconnaissance into unified platforms that allow customers to collect, process, and act on information in real time. This integrated approach has become increasingly important as modern defense operations rely on data fusion, secure connectivity, and rapid decision-making across multiple theaters.
Geographically, L3Harris Technologies Inc maintains a broad operational footprint, with facilities and employees across Florida, Texas, Arizona, and other U.S. states, as well as international locations including Melbourne and key allied markets. This global presence supports a wide range of government customers and suppliers, enabling the company to participate in defense programs spanning air, sea, land, and space. Its involvement in space-based systems reflects the growing importance of space as a strategic domain, particularly for surveillance, communications, and intelligence gathering.
The company’s background also reflects the realities of operating within the defense sector, where technology providers are often scrutinized for their role in conflicts and the use of surveillance or weapons systems. L3Harris Technologies Inc has been referenced in public discussions, press releases, and letters involving human rights concerns, potential war crimes, and violations raised by international organizations and high commissioners. While such scrutiny is common for defense suppliers, the company consistently emphasizes that it sells equipment, systems, and services to government entities and operates under strict regulatory, export control, and compliance frameworks. This environment underscores both the sensitivity and strategic importance of the technologies it provides.
Financially, L3Harris Technologies Inc entered its post-merger era as a large-scale defense contractor, generating more than $20 billion in annual revenue and employing tens of thousands of people worldwide. Its size and diversification across communications systems, integrated mission systems, airborne systems, and space technologies provide resilience against individual program delays or shifts in procurement priorities. The company’s ability to maintain long-term customer relationships and secure repeat defense contracts has been a defining feature of its business model.
Over time, L3Harris Technologies Inc has aligned its background with broader shifts in defense priorities, including heightened focus on cyber domains, electronic warfare, and intelligence capabilities. As governments respond to evolving threats, from state-based conflicts to asymmetric warfare and cyber intrusion, the demand for secure communications, advanced sensors, and integrated defense systems continues to grow. This structural demand has reinforced the company’s relevance within the defense ecosystem and shaped its long-term strategic direction.
Viewed through a historical lens, L3Harris Technologies Inc represents the convergence of legacy defense expertise and modern technology integration. Its background is defined not by consumer markets or short technology cycles, but by decades-long government relationships, mission-critical performance requirements, and the steady evolution of national security needs. This positioning continues to influence how the company operates, invests, and presents itself as a core supplier within the global defense industry.
L3Harris Technologies Inc Stands at the Center of a Reshaped Global Defense Industry
L3Harris Technologies Inc has emerged as one of the most strategically important companies in the modern defense industry, operating at the intersection of communications systems, integrated mission systems, space technologies, and national security infrastructure. Headquartered in Florida following the landmark merger between Harris Corporation and L3 Technologies in 2019, the company was formed to address an era defined by asymmetric threats, cyber domains, space-based surveillance, and increasingly complex defense requirements. With operations and facilities spanning Florida, Texas, Arizona, Melbourne, and multiple international locations, L3Harris Technologies has positioned itself as a trusted disruptor within the global defense ecosystem.
The company’s relevance has expanded as governments reassess defense priorities amid heightened geopolitical tensions, renewed focus on intelligence and reconnaissance, and the growing complexity of operating in densely populated civilian areas. In this environment, demand for secure communications, precision surveillance systems, and integrated defense equipment has accelerated, reinforcing L3Harris Technologies’ role as a long-term supplier of mission-critical systems.
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A Broad Portfolio Anchored in Communications and Integrated Mission Systems
L3Harris Technologies operates through a diversified portfolio that includes communications systems, integrated mission systems, airborne systems, space propulsion, and power systems. These capabilities enable the company to deliver end-to-end solutions across air, land, sea, space, and cyber domains. Tactical radios, broadband communications devices, advanced sensors, surveillance systems, and reconnaissance equipment form the backbone of its offerings, many of which are deeply embedded in government and defense customer operations.
The company’s communications segment remains a cornerstone of its business, supplying secure tactical radios and broadband communications equipment to the U.S. Department of Defense and allied governments. These systems are designed to operate reliably in contested environments, supporting intelligence gathering, training exercises, and real-world operations. Integrated mission systems further enhance L3Harris Technologies’ value proposition by combining sensors, data fusion, and command-and-control technologies into unified platforms tailored for modern warfare and surveillance requirements.
Defense Contracts, Revenue Visibility, and Financial Scale
L3Harris Technologies Inc generates approximately $20.4 billion in annual revenue, supported by a substantial backlog exceeding $38 billion. This backlog provides long-term revenue visibility and reflects the company’s deep involvement in multi-year defense contracts, many of which are funded under national security budgets that tend to be resilient even during broader economic slowdowns.
Despite periodic scrutiny surrounding defense suppliers and their involvement in global conflicts, including concerns raised by human rights organizations and commentary from international bodies such as high commissioners regarding potential war crimes and violations, L3Harris Technologies continues to operate within regulatory frameworks set by the U.S. government and international law. The company regularly emphasizes compliance, training, and oversight in its press releases and disclosures, highlighting that it supplies equipment and systems to government customers rather than directly engaging in combat operations.
Market Performance Signals a Structural Re-Rating
From a market perspective, L3Harris Technologies has experienced a significant re-rating over the past year. Even after a recent pullback of approximately 3.8 percent over the last week and 2.4 percent over the last month, the stock remains up 34.4 percent year to date and 34.9 percent over the past twelve months. This performance suggests that investors have been steadily reassessing the company’s long-term prospects rather than reacting to short-term news flow.
That momentum has been driven by a steady cadence of defense contract wins and expanding demand for communications, surveillance, and space solutions. As governments respond to evolving threats, including cyber warfare, space-based intelligence, and advanced reconnaissance needs, L3Harris Technologies has benefited from its diversified exposure across multiple defense domains.
Discounted Cash Flow Analysis Suggests Undervaluation
A deeper valuation analysis provides additional support for the bullish thesis. A Discounted Cash Flow model, using last twelve months free cash flow of approximately $1.85 billion as a starting point, projects meaningful cash flow expansion over the coming decade. Analyst and extrapolated projections estimate free cash flow rising to around $3.05 billion in 2026, $3.67 billion in 2029, and approximately $4.55 billion by 2035.
When these future cash flows are discounted back to present value, the model arrives at an estimated intrinsic value of about $381.69 per share. This implies that L3Harris Technologies Inc is trading at roughly a 27.0 percent discount to its calculated fair value. Based on this approach, the stock appears undervalued, particularly when viewed through the lens of long-duration defense contracts and structurally higher defense spending.
Price to Earnings Context Shows No Excessive Premium
Complementing the DCF analysis, a price to earnings comparison offers a more conservative but still constructive perspective. L3Harris Technologies currently trades at a price to earnings ratio of approximately 29.6 times. This is below the broader aerospace and defense industry average of around 36.3 times and also below the peer group average of roughly 33.2 times.
Using a tailored Fair Ratio framework that accounts for the company’s earnings growth outlook, profitability, risk profile, and market capitalization, a fair multiple of about 29.8 times is derived. This places the current valuation very close to intrinsic expectations, suggesting that the market is not overpaying for L3Harris Technologies’ earnings power despite strong recent performance.
Strategic Positioning Amid National Security and Ethical Scrutiny
L3Harris Technologies operates in a sector where national security imperatives and ethical considerations often intersect. The company has faced questions related to surveillance technologies, weapons systems, and their use in conflict zones such as Israel and other regions experiencing armed conflict. References to potential war crimes and violations frequently appear in public discourse, particularly when defense suppliers are mentioned in letters, reports, or commentary issued by international organizations.
From a business perspective, these dynamics reinforce the importance of compliance, governance, and customer selection. L3Harris Technologies consistently states that it sells equipment, systems, and services to government entities and acts in accordance with export controls, laws, and contractual obligations. While such scrutiny can create headline risk, it also underscores the strategic importance of the technologies the company provides and the barriers to entry that protect established suppliers.
Long-Term Narrative Supports Multiple Valuation Outcomes
Ultimately, the investment case for L3Harris Technologies Inc depends on the narrative an investor believes will unfold. A more optimistic narrative assumes accelerating defense demand, sustained revenue growth, and margin expansion toward roughly 11 percent, which could support a fair value in the mid-$300s or higher. A more cautious narrative might incorporate slower growth, increased regulatory scrutiny, or margin pressure, leading to a valuation closer to $250.
What is clear is that L3Harris Technologies operates in a structurally growing segment of the global economy, with demand driven by national security priorities rather than consumer cycles. Its scale, diversified portfolio, and cash-generative business model position it as a long-term participant in defense modernization, space-based intelligence, and secure communications infrastructure.
Why L3Harris Technologies Inc Remains a Compelling Long-Term Defense Play
L3Harris Technologies Inc combines scale, technological depth, and long-term government relationships in a way few defense companies can replicate. With more than $20 billion in annual revenue, tens of billions in backlog, and projected free cash flow growth that outpaces many peers, the company offers a blend of stability and upside that continues to attract investor interest.
Even after a strong run, valuation metrics suggest the market may still be underestimating the durability of its cash flows and balance sheet strength. In a world where threats are evolving and defense capabilities are being redefined across air, land, sea, space, and cyber domains, L3Harris Technologies remains positioned as a core supplier to governments navigating an increasingly complex security landscape.
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