L3Harris Technologies, Inc. (LHX) Stock Analysis

L3Harris Technologies’ principal competitive advantages stem from its technological breadth, entrenched customer relationships, and operational agility. The company is a top-tier supplier of advanced communications, surveillance, and missile defense systems, with a portfolio spanning space, air, land, and cyber domains. Its recent acquisition of Aerojet Rocketdyne has strengthened its position in propulsion and missile technology, areas critical to current U.S. and allied defense priorities.

L3Harris benefits from high switching costs and long-term contracts with the U.S. Department of Defense, which accounts for approximately 77% of revenue. This customer concentration, while a risk, also provides revenue stability and deep integration into mission-critical programs. The company’s “trusted disruptor” strategy emphasizes rapid delivery and innovation, enabling it to win share in emerging areas such as hypersonic missile tracking and resilient communications—fields where it competes directly with Raytheon (RTX) and Northrop Grumman (NOC).

Compared to peers, L3Harris has demonstrated above-average margin discipline, with segment operating margins reaching 15.6% in 2025, versus Raytheon’s 12–13%. Its international sales mix (c. 22% of revenue) is higher than many U.S.-centric rivals, providing some diversification. The company’s $32 billion order backlog and record 1.5x book-to-bill ratio underscore strong demand and execution. However, its dependence on government budgets and the integration of recent acquisitions remain ongoing challenges.