L3Harris Technologies, Inc. (LHX)
Quantitative Summary
DeterministicLHX trades at 34.3x earnings, roughly in line with its sector average of 44.7x. Strong operational fundamentals (Piotroski 8/9) with Altman Z of 2.8. DCF fair value of $359 suggests 0% upside based on model assumptions.
Generated deterministically from quant metrics and financial statements. Not a recommendation.
Algorithmic Teardown
AI-GeneratedThe fundamental economics of LHX present a divergence between robust operational stability and suboptimal capital allocation efficiency. While the Piotroski F-Score of 8/9 and negative Beneish M-Score of -2.58 signal strong financial health with minimal earnings manipulation risk, the ROIC-WACC spread stands at -2.1%, indicating that current operations are destroying value relative to the cost of capital. This valuation gap persists despite an ROE of 8.2% driven primarily by leverage (Equity Multiplier 2.10x) rather than operational momentum, as evidenced by stagnant revenue growth of only 2.5%. The DuPont decomposition reveals that while net margins remain healthy at 7.3%, asset turnover is constrained at 0.53x, suggesting the equity multiplier is artificially inflating returns without corresponding efficiency gains in working capital or fixed assets.
Valuation metrics reflect a significant premium relative to fundamental performance, with a current P/E of 41.7x that appears disconnected from the implied long-term free cash flow growth rate of 6.7%. Although the DCF model suggests fair value at $421, implying approximately 21.9% upside potential based on discounted future flows, this calculation assumes sustained profitability in a sector where revenue expansion is negligible. The market pricing likely incorporates expectations for margin expansion or multiple re-rating that are not currently supported by the trailing twelve-month data, creating a scenario where high valuation multiples coexist with modest organic growth and negative capital efficiency spreads.
Risk-adjusted performance indicators offer conflicting signals regarding future equity premium capture. The stock exhibits a notable Fama-French alpha of 11.13% annually, coupled with a positive Value Factor tilt (HML: 0.342), suggesting it has historically outperformed when value characteristics dominate the market cycle. However, this potential is counterbalanced by recent insider activity showing $6.8 million in net selling over the past ninety days and a Profitability Factor score of -0.067, which neutralizes any advantage derived from high margins. These factors collectively suggest that while the balance sheet remains intact, the combination of negative capital efficiency and active insider distribution warrants caution despite the theoretical DCF upside.
Generated by LLM from quantitative data inputs. May contain inaccuracies. Not investment advice.
DCF Sandbox
Interactive5-year two-stage DCF. Terminal growth 3%. Default sliders match the pre-computed base case. Drag to explore scenarios. Not investment advice.
The growth rate the market implicitly expects over the next 10 years to justify today's price. Compare with historical growth of 3% YoY revenue.
Sensitivity Matrix
| TG ↓ / WACC → | 6.7% | 8.7% | 10.7% |
|---|---|---|---|
| 2% | $467 | $307 | $221 |
| 3% | $588 | $359 | $249 |
| 4% | $797 | $432 | $284 |
Center = base case. Green = >10% upside, Red = >10% downside vs $308.12.
Pre-computed DCF: WACC=8.7%, terminal growth 3%. Fair value $359 (+0.2%). Not investment advice.
Valuation Context
Currently trading 50% above its 5-year average P/E of 27.6x.
Price Chart with Moving Averages
Technical Setup
AI GeneratedL3Harris Technologies, Inc. is currently trading at $313.37 within the Industrials sector, presenting a specific snapshot for relative-value analysis regarding its proximity to moving average envelopes. Without explicit envelope boundaries or standard deviation metrics in the provided dataset, determining whether this price point represents an extreme overextension or a consolidation zone requires contextual comparison against historical volatility bands that are not currently visible. The absence of these surrounding technical parameters prevents a definitive assessment of mean-reversion probability based solely on the current figure; typically, prices trading significantly outside such envelopes suggest higher potential for regression toward the mean, whereas those nestled centrally imply continued range-bound behavior or trend continuation depending on slope direction. Consequently, the immediate implication hinges entirely on where $313.37 sits relative to the calculated upper and lower bounds of its specific time-weighted average envelope. If this level were touching an extreme boundary, it might statistically indicate a heightened likelihood of price correction toward the centerline, whereas positioning well within the band could suggest stability or ongoing momentum without immediate reversal signals. The current data point alone offers limited insight into these dynamics because the necessary reference lines defining the "normal" trading range are missing from the input set. Investors must therefore evaluate this $313.37 level in conjunction with a full technical chart to ascertain if it represents a statistically significant deviation or a standard fluctuation within the established mean-reversion framework. The potential for price adjustment depends on the distance between the
Quant Health Deep Dive
Profitability & Value Creation
✅ Conservative payout — room for dividend increases.
DuPont Analysis — ROE Decomposition
Breaking down Return on Equity to see how the company generates its ROE — efficiency, margins, or leverage.
Balance Sheet Health
Insider Activity (Last 90 Days)
Open-market buys vs sells by company insiders. Source: yfinance.
Earnings Surprise History
EPS estimates vs actuals for the most recent reported quarters. Source: yfinance.
Dividend History
| Date | Amount | Change |
|---|---|---|
| 2026-03-06 | $1.2500 | +4.2% |
| 2025-11-17 | $1.2000 | 0.0% |
| 2025-09-05 | $1.2000 | 0.0% |
| 2025-06-03 | $1.2000 | 0.0% |
| 2025-03-10 | $1.2000 | +3.4% |
| 2024-11-18 | $1.1600 | 0.0% |
| 2024-09-06 | $1.1600 | 0.0% |
| 2024-06-04 | $1.1600 | 0.0% |
| 2024-03-07 | $1.1600 | +1.8% |
| 2023-11-16 | $1.1400 | 0.0% |
| 2023-09-01 | $1.1400 | 0.0% |
| 2023-06-01 | $1.1400 | 0.0% |
Dividend and split data from SEC filings and market data. Amounts are per share, not adjusted for splits. Source: yfinance.
Risk Profile
Sharpe = risk-adjusted return (higher is better). Max drawdown = largest peak-to-trough decline. 1,200+ trading days.
Underwater (Drawdown from Peak)
How far below the all-time high the price has been over time. Deeper = more pain for holders.
Rolling 60-Day Beta vs S&P 500 (VOO)
How the stock's sensitivity to market moves changes over time. β > 1 = more volatile than the market.
Fama-French 5-Factor Exposure
Academic factor model decomposition — what's really driving this stock's returns.
Fama-French 5-Factor Model. Data: Kenneth French Data Library. Regression over 3 years of daily returns.
Fundamentals
Passive Flow Attribution
ETF Draft EffectWhen investors buy or sell ETFs like ARKX or ITA, the fund manager is mechanically forced to buy or sell LHX shares regardless of L3Harris Technologies, Inc.'s individual fundamentals. We estimate $9.5B of passive capital is structurally linked to LHX through 8 tracked ETFs. This substantial passive exposure means that ETF inflows and outflows — not company fundamentals — can dominate daily volume on this stock.
Passive exposure = Σ (ETF AUM × stock weight in ETF) across 8 tracked ETFs. Actual passive ownership is larger (includes mutual funds). Not investment advice.
ETF Contagion Visualizer
Simulate a price drop in L3Harris Technologies, Inc. to visualize passive redemption contagion across ETFs and collateral stocks.
If L3Harris Technologies, Inc. (LHX) experiences a significant drawdown, ETF redemptions can create collateral selling pressure on co-held stocks. Our model identifies GE Aerospace (GE) as the most exposed collateral stock, sharing 1 ETFs with LHX. This is the "Passive Contagion" effect described in the Inelastic Market Hypothesis.
Contagion model based on shared ETF exposure and constituent weights across 35 tracked ETFs. Estimated selling pressure is a simplified model — actual impact depends on market liquidity, ETF redemption mechanics, and market-maker activity.
LHX Ownership Dynamics
Passive funds hold 1 in every 6 LHX shares, reducing daily market volatility.
L3Harris Technologies, Inc. (LHX) exerts notable gravity on the passive index market, currently representing 8.3% of the ARKX (ARKX) and 4.3% of the ITA (ITA). Across 34 tracked ETFs, approximately 29M shares (15.7% of float) are held by passive funds and rarely trade on the open market. This level of passive ownership means index rebalances can create outsized volume events.
ETFs with Highest LHX Exposure
Float lock-up computed from 34 ETFs tracked by SecuritiesDB. Actual passive ownership is higher (includes mutual funds, pension funds, etc.).
LHX Institutional Volume Profile
252-day volume distribution by price level. The Point of Control (POC) marks — the price where the most institutional volume transacted — an implicit support/resistance floor.
The highest-volume price zone for L3Harris Technologies, Inc. over the past year sits near $274.10 (10% of 252-day volume). The current price of $308.12 trades 12.4% above this institutional floor — a sign of upside momentum, though a pullback to the POC zone is a common reversion target.
Volume Profile computed from 252 trading days of OHLCV data. Volume allocated to price bins proportionally based on daily high-low range. Not investment advice.
LHX Capital Efficiency
How efficiently does L3Harris Technologies, Inc. convert operating profits into free cash? The FCF Conversion ratio measures the gap between accounting earnings and real cash generation.
L3Harris Technologies, Inc. converts 71% of its EBITDA into free cash flow, an exceptional conversion rate indicating an asset-light business model with minimal capital reinvestment drag. However, the ROIC-WACC spread is negative (-2.8%), suggesting reinvested capital is destroying shareholder value.
Capital efficiency = Free Cash Flow ÷ EBITDA. Reinvestment = (EBITDA − FCF) ÷ EBITDA. Metrics from latest annual filings. Not investment advice.
Fails-to-Deliver (FTD) History
SEC-reported settlement failures. Elevated FTDs can indicate high short-selling pressure, operational settlement issues, or naked shorting activity.
| Date | Failed Shares | Close Price | Notional Value |
|---|---|---|---|
| 2026-05-14 | 16 | $304.93 | $4,878.88 |
| 2026-04-27 | 110,188 | $317.51 | $35.0M |
| 2026-04-22 | 38 | $340.30 | $12,931.4 |
| 2026-04-15 | 3 | $355.56 | $1,066.68 |
| 2026-04-14 | 36 | $357.95 | $12,886.2 |
| 2026-04-13 | 2,689 | $353.59 | $950,803.51 |
| 2026-04-02 | 163 | $353.91 | $57,687.33 |
| 2026-03-30 | 9 | $343.00 | $3,087 |
| 2026-03-25 | 418 | $351.42 | $146,893.56 |
| 2026-03-13 | 691 | $357.88 | $247,295.08 |
| 2026-03-06 | 10 | $360.10 | $3,601 |
| 2026-03-02 | 103 | $364.54 | $37,547.62 |
| 2026-02-12 | 3,000 | $340.29 | $1.0M |
| 2026-02-09 | 9 | $349.66 | $3,146.94 |
| 2026-01-30 | 12,789 | $356.02 | $4.6M |
| 2026-01-26 | 6,574 | $354.73 | $2.3M |
| 2026-01-05 | 178 | $304.48 | $54,197.44 |
| 2025-12-01 | 52 | $278.69 | $14,491.88 |
| 2025-11-13 | 3,727 | $300.24 | $1.1M |
| 2025-11-12 | 17,973 | $301.68 | $5.4M |
| 2025-10-30 | 68 | $286.87 | $19,507.16 |
| 2025-10-28 | 672 | $291.14 | $195,646.08 |
| 2025-10-27 | 253 | $293.20 | $74,179.6 |
| 2025-10-15 | 7 | $299.99 | $2,099.93 |
| 2025-10-14 | 501 | $293.42 | $147,003.42 |
| 2025-10-09 | 64 | $306.76 | $19,632.64 |
Source: SEC Regulation SHO FTD data. Data is reported with a ~30 day delay. High FTD quantities relative to average daily volume may indicate settlement stress.
SEC Comment Letters
SEC correspondence with the company regarding their filings. Comment letters often flag disclosure deficiencies, accounting concerns, or material omissions.
Source: SEC EDGAR correspondence. Comment letters are public records of SEC staff review of company filings.
Price Correlations
Statistical correlation of daily returns with other stocks. High correlations indicate stocks that move together; negative correlations can offer diversification.
| Peer | 252-Day (1Y) | 126-Day (6M) | Direction |
|---|---|---|---|
| WTGXX | NaN | NaN | |
| GD | 0.618 | 0.676 | Moderate |
| HII | 0.593 | 0.648 | Moderate |
| NOC | 0.518 | 0.635 | Moderate |
| KTOS | 0.480 | 0.545 | Moderate |
| LMT | 0.473 | 0.523 | Moderate |
| RTX | 0.472 | 0.567 | Moderate |
| CW | 0.467 | 0.511 | Moderate |
| BWXT | 0.387 | 0.497 | Moderate |
| MLM | 0.383 | 0.439 | Moderate |
Pearson correlation of daily log returns. 252d ≈ 1 trading year. Computed from price history. Not investment advice.
Compare LHX to Peers
Quant metrics computed deterministically from financial statements and price data. Updated: 2026-06-02.
SecuritiesDB provides programmatic data aggregation for informational purposes only. None of the metrics, summaries, or algorithmic flags constitute a recommendation to buy or sell any security.