Deutsche Bank analysts upgraded the rating for L3Harris Technologies (NYSE:LHX) from Hold to Buy, setting a new price target of $240.00, up from the earlier $184.00. Deutsche’s upgrade is based on three key differences in L3Harris Technologies’ market position.
Firstly, the analysts anticipate a significant margin expansion for LHX over the next three years, contrasting with the flat margin outlook for its peers. Secondly, they noted that LHX is overcoming challenges that continue to affect its large-cap peers.
Lastly, the analysts pointed out that LHX has long traded at a discount compared to these peers, despite having a more promising margin outlook and lower downside risk. They conclude that the upgrade reflects both an anticipated positive revision in revenues and margins and a potential for relative multiple expansion due to LHX’s distinct margin trajectory and risk profile compared to other major defense industry players.