L3Harris (LHX), in line with a forecast by DHI (DHI) CEO Art Zeile (DHI owns ClearanceJobs), is benefiting a great deal from the strength of its rocket motor and missile-defense businesses. Further, L3 reported commendable third-quarter results on October 29, while its valuation is low and Wall Street’s enthusiasm for the name appears to have been rekindled in recent weeks.
As a consequence of these developments, value investors should consider buying LHX stock.
Missile-Defense and Rocket-Motor Revenue Is Lifting L3Harris’ Prospects
Speaking on the company’s Q3 earnings call, CEO Sam Mehta indicated that L3 Harris had booked $11 billion in “contractual orders” involving the PAC-3 and THAAD missile-defense programs. In a January 2026 column, Zeile, DHI’s CEO, wrote that “L3 is positioned to benefit from already-appropriated Golden Dome funding.” Golden Dome is the Trump administration’s huge missile-defense initiative.
Asserting that the company’s “Department of War solid rocket motor programs (are) just getting started,” Mehta noted that L3 is looking to “triple (its) THAAD solid rocket motor deliveries in 2027 as compared to 2026, and … do the same on numerous additional (rocket motor) programs.”
Indeed, L3 is providing the motor for the Sentinel ICBM and will double its PAC-3 motor deliveries in 2027 versus 2026. In Zeile’s column for TheStreet, he noted that L3’s rocket-motor business would likely benefit from an increase in the Space Force’s budget.
Strong Overall Q3 Results and an Attractive Valuation
The company’s sales, excluding acquisitions and divestments, rose 9% versus the same period a year earlier to $6.1 billion, while earnings per share climbed 33% year-over-year to $3.28. L3’s backlog advanced to a record $53.2 billion, versus $42 billion at the end of the previous quarter, as its book-to-bill ratio came in at a very impressive 3.2 times as of September 30.
Turning to valuation, the shares have a forward price-earnings ratio of 20.65 times. Given the company’s strong growth and opportunities as the U.S. and other countries continue to aggressively pursue missile defense, the valuation of LHX stock is quite attractive.
The Street Is Upbeat on LHX Stock Again
In the wake of L3’s Q3 results, Bank of America raised its price target on the name to $375 from $325 and kept a Buy rating on the shares. According to the bank, the company’s “growing backlog positions (it) well to benefit from global strategic defense initiatives.” Another bullish bank, Citi, resumed coverage of LHX stock with a $348 price target and a Buy rating.
In the month that ended on November 10, the shares advanced 16%. Further, LHX stock finished trading on November 10 at $275.17, putting it well above its key 50-day moving average of $250.16. And although the shares were still meaningfully below their 200-day moving average of $302.79, they appear to be heading in the right direction.
Finally, one website, as of the early morning hours of November 11, rated the shares as a “Strong Buy” from a technical perspective.
*This article is intended to be informational only; it is not financial advice.
