On Monday, JPMorgan made a bullish move on L3Harris Technologies (NYSE:LHX), increasing its price target to $276 from the previous $250, while keeping an Overweight rating on the stock. The firm's analyst noted that L3Harris had outperformed post-earnings, despite delivering strong results and raising its outlook. This performance, according to the analyst, opens up further opportunities for the stock.
The analyst acknowledged that L3Harris's stock did not surge after earnings, which was not unexpected given the broader sector dynamics. Competitors like Lockheed Martin (NYSE:LMT) and Northrop Grumman (NYSE:NOC) also reported strong quarters, managing to alleviate some concerns that had previously affected their stock performance. The market had anticipated a strong showing from L3Harris following an impressive first quarter, and the company's narrative is one of steady improvement and financial discipline.
The commentary from JPMorgan highlighted L3Harris's focus on gradual improvement, margin expansion, cash flow generation, and debt reduction. These factors are seen as more incremental in nature and not typically drivers of dramatic market reactions after earnings reports, barring any other significant developments.
The price target adjustment is based on a forward-looking analysis. JPMorgan has rolled forward its price target setting a December 2025 goal, which reflects a multiple of 17.5 times the firm's 2026 adjusted free cash flow estimate of nearly $16 per share for L3Harris.
In summary, JPMorgan's revised price target for L3Harris Technologies is predicated on the company's solid quarterly performance and promising financial metrics, suggesting a steady path ahead for the defense contractor's stock value.
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