Harris Corporation
(
HRS
) - a leader in the public safety and professional communication
market, has received a seven-year contract worth $331 million that
entails them to provide highly reliable air and ground data
communications services for a key Federal Aviation Administration
(FAA) program.
Per the terms of the Data Communication Integrated Service
(DCIS) contract the Melbourne, Florida-based company will provide
management and delivery of data communication service that will
transform voice-based air traffic control (ATC) to automated air
traffic management for future requirement. The contract also
contains 10 one-year options that could extend the duration till
2029.
The Harris DCIS team includes leading aviation and
communications innovators with huge experience and includes Adfero
Group, American Airlines, a subsidiary of
AMR Corporation
(
AAMRQ
), ARINC, The Brattle group, CGH,
General Electric Company
(
GE
) and six other companies. The DCIS contract will offer highly
reliable ATC communications, improved arrival/departure routes, and
reduced emissions propelling fuel efficiency as a
result.
Since long, Harris has been developing and integrating system
solutions for the FAA in support of the National Airspace System
(NAS). We believe the contract will not only strengthen its
Government Communication Systems order book but will also provide
solid stability to the above-mentioned segment. The company will
continue to win many such contracts as it has been selected as a
prime contractor for FAA Telecom infrastructure (FTI) initiative of
National Airspace System (NAS).
The current Zacks Consensus Estimate for Harris Corp. is pegged
at $1.12 for the fiscal first quarter 2013 with a growth rate
estimate of 5.92%. For fiscal years 2013 and 2014, the Zacks
Consensus Estimates stand at $5.15 and $5.28 with a growth rate of
(0.91%) and 2.52% respectively.
Recommendation:
Considering the fundamentals, we maintain our long-term Neutral
recommendation on Harris Corp. Currently, HRS has a Zacks #3 Rank,
implying a short-term Hold rating on the stock.
AMR CORP (AAMRQ): Free Stock Analysis Report
GENL ELECTRIC (GE): Free Stock Analysis Report
HARRIS CORP (HRS): Free Stock Analysis Report
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