L3Harris Technologies (LHX) announced on October 30 that it had been granted a $97.51 million indefinite-delivery/indefinite-quantity contract to provide repair and return (R&R) services for both unclassified and classified line-replaceable unit and standard equipment module assets of the ALQ-211 (V)4, (V)8 and (V)9 systems of the airborne F-16 Advanced Integrated Defense Electronic Warfare Suite weapon systems.
As per the terms of the agreement, the contract will involve Foreign Military Sales (FMS) to support the Chilean, Indian, Omani, Pakistani, Polish, Turkish, Iraqi and Moroccan air forces.
This R&R work, which will be conducted in Clifton, New Jersey, is necessary to bring the F-16 AIDEWS systems back to mission capable condition and to equip partnering F-16 FMS fleets with airborne self-defense and survivability against electromagnetic threats. According to management, the restorations are set to wrap up in 2025.
The contract comes on the heels of strong order momentum witnessed in the third quarter. Within the Mission Avionics segment, L3Harris nabbed $255 million in orders for F-35 avionics and modernization components, bringing total orders for the year to more than $650 million on the platform.
LHX was also awarded a multi-million dollar contract for the initial production lot of the modernized open mission systems processor for the F/A-18 and EA-18G, an important element of the platforms’ Block upgrades.
So far in 2020, shares of L3Harris Technologies have tumbled 19%, but Wall Street is overwhelmingly bullish on the stock. The company scores a Strong Buy analyst consensus with 9 Buys versus no Holds or Sells. With the average analyst price target landing at $235.44, shares could gain 46% in the next year. (See L3Harris Technologies stock analysis on TipRanks)
Morgan Stanley analyst Kristine Liwag started off her coverage of the company by assigning a Buy rating and $248 price target (54% upside potential). The initiation was driven by her more optimistic outlook for the space as a whole.
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