Analyst Confidence Rises on L3Harris Strategic Moves

Market sentiment toward defense contractor L3Harris has turned increasingly favorable, driven by a series of strategic initiatives and solid financial performance. This optimism is underscored by a significant price target upgrade from the investment research firm Bernstein, which reaffirms a positive outlook for the company's stock.

Bernstein analysts have raised their price objective for L3Harris shares from $369 to $398, maintaining an "Outperform" rating. This adjustment follows the company's latest quarterly report, which exceeded market expectations. For the quarter, L3Harris posted earnings per share of $2.70, surpassing the consensus estimate of $2.60. Revenue saw a 6.9% increase, reaching $5.66 billion.

Robust Contract Wins and Technological Edge

The company's growth narrative is supported by a steady stream of substantial government contracts. A recent highlight is an $843 million award from the Space Development Agency for the production of 18 missile-tracking satellites. Furthermore, L3Harris has demonstrated its technological leadership by delivering three powerful 12-kilowatt Advanced Electric Propulsion Systems (AEPS) for NASA's Lunar Gateway program. These represent the most potent electric propulsion systems ever built for spaceflight.

Should investors sell immediately? Or is it worth buying L3Harris?

Strategic Restructuring Takes Shape

Underpinning the positive analyst view is a deep structural overhaul currently underway at L3Harris. The firm has consolidated its operating segments from four down to three: Space & Mission Systems, Communications & Spectrum Dominance, and Missile Solutions. This reorganization is designed to better align the company's technological capabilities with contemporary defense sector priorities.

Concurrently, L3Harris is advancing the sale of a 60% stake in its Space Propulsion and Power Systems business to AE Industrial Partners. The transaction values the enterprise at $845 million. Upon completion, L3Harris will retain a 40% interest in the new standalone company, which will operate under the "Rocketdyne" name.

Trading Near Highs with Upward Trajectory

Reflecting this confidence, L3Harris stock is trading around $336, hovering close to its 52-week high of $338.23 and remaining well above its key moving averages. Looking ahead, analyst projections for the 2026 fiscal year forecast earnings per share of $11.12. The market's focus will now shift to the upcoming quarterly results for evidence that the strategic realignment is delivering on its promised operational and financial benefits.