Is L3Harris Technologies Inc (LHX) overvalued?
On Equity Rank's model estimate, LHX trades 17% below its fair value. L3Harris Technologies Inc (LHX) last closed at $259.89; the multi-method model fair value is $311.62.
| Price | Model fair value | Price vs model |
|---|---|---|
| $259.89 | $311.62 | 17% below |
What the answer rests on
- 7 of 12 valuation methods put LHX's value above its price and 5 put it below, so the methods disagree.
- To justify today's price, LHX's free cash flow would need to grow about -0.4% a year for ten years (a reverse discounted cash flow). Over the last three years it actually grew 12.1% a year.
- LHX trades at 24.2 times its last year's earnings, against a median of 31.8 for 37 profitable Aerospace & Defense companies.
- Over the past year the price sat below the model fair value on 97% of trading days. The gap ranged from 39% below to 2% above the model fair value.
Read this before relying on it
The model fair value is an estimate from published financial statements. It is not a forecast of where the price goes, and it can be wrong. Within 10% either side we call it close to fair value: valuation models are not precise enough to read more into a smaller gap. Our own lists have no proven edge over the market yet; the live record shows every result, misses included.
Every valuation method behind LHX's fair value · What prices assume · Other companies