MELBOURNE, Fla. - L3Harris Technologies (NYSE: NYSE:LHX) and Palantir Technologies Inc . (NYSE: NYSE:PLTR) have announced a strategic partnership aimed at advancing technology development and expediting L3Harris' digital transformation. This collaboration will integrate L3Harris' expertise in sensors and software-defined systems with Palantir's Artificial Intelligence Platform (AIP), enhancing capabilities and resilient connectivity for joint-all-domain operations.
Christopher E. Kubasik, Chair and CEO of L3Harris, emphasized the partnership's commitment to delivering value to global customers through integrated capabilities. Alex Karp, CEO of Palantir, highlighted the collaboration's goal to leverage AI and cutting-edge hardware for the U.S. and its allies.
The partnership includes initiatives such as collaboration on U.S. Army programs, internal use of Palantir AIP at L3Harris for digital transformation, and development of advanced technologies like radios and sensors. The companies are investing in solutions to push computing to the far edge, including radios as sensors and orbital processing on satellites, aiming to revolutionize communication and tactical decision-making.
A recent demonstration showcased the integration of L3Harris' WESCAM MX-20 EO/IR system with Palantir's Sensor Inference Platform (SIP), which provided edge AI for improved target detection and delineation during a live fly test. The integration of SIP onto the MX-20 resulted in enhanced situational awareness, automatic target identification, and communication, reducing operator workload while increasing effectiveness.
This partnership announcement is based on a press release statement and includes forward-looking statements that involve risks and uncertainties. These statements reflect the companies' current expectations and beliefs regarding their cooperation and the potential benefits of their combined platforms and systems. However, there are inherent risks and uncertainties that could affect the realization of these expectations.
In other recent news, L3Harris Technologies reported a 9% increase in non-GAAP earnings per share for the second quarter of 2024, alongside a substantial backlog of $32 billion. The company also announced a quarterly cash dividend of $1.16 per common share. L3Harris Technologies secured a potentially lucrative contract with the U.S. Navy, worth $587.4 million, for the provision of new tactical jamming pods over the next five years. Furthermore, L3Harris Technologies unveiled its new autonomous vehicle system, Diamondback (NASDAQ:FANG), designed for reconnaissance and security operations. Truist Securities increased its price target on L3Harris Technologies to $293 from the previous target of $250, while Wolfe Research upgraded its rating from Peerperform to Outperform, setting a price target of $300. However, Morgan Stanley downgraded L3Harris's stock from Overweight to Equalweight. These are the recent developments in the company's trajectory.
InvestingPro Insights
L3Harris Technologies' strategic partnership with Palantir aligns well with its strong market position and financial performance. According to InvestingPro data, L3Harris boasts a substantial market capitalization of $46.63 billion, reflecting its prominence in the Aerospace & Defense industry. This collaboration could further solidify the company's market standing and drive future growth.
The company's revenue growth of 15.44% over the last twelve months and quarterly growth of 12.91% in Q2 2024 demonstrate its ability to expand its business, which may be further accelerated by this new partnership. Additionally, L3Harris' gross profit margin of 26.33% suggests a healthy ability to generate profit from its core business activities.
InvestingPro Tips highlight L3Harris' strong dividend history, having raised its dividend for 23 consecutive years and maintained payments for 54 years. This consistent dividend policy, coupled with a current dividend yield of 1.89%, may appeal to income-focused investors looking for stability in the defense sector.
The company's stock performance has been robust, with a one-year price total return of 41.51% as of the latest data. Trading near its 52-week high, L3Harris seems to be in a position of strength as it enters this new technological partnership.
For investors seeking more comprehensive analysis, InvestingPro offers 12 additional tips for L3Harris Technologies, providing a deeper understanding of the company's financial health and market position.
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