L3Harris Technologies, Inc. LHX recently revealed that it has secured a follow-on production contract valued at up to $200 million to produce Guided Multiple Launch Rocket System (“GMLRS”) Insensitive Munition (“IM”) propulsion units.
The contract underscores L3Harris’ proficiency in missile propulsion technology and commitment to providing high-performance, reliable propulsion solutions for military missions. It also marks the largest GMLRS IM contract the company has received from Lockheed Martin for a 12-month performance period.
LHX’s Proven Capabilities in Providing Propulsion Systems
L3Harris has continuously provided reliable and innovative propulsion solutions in support of U.S. warfighters and allied forces. Building on a strong legacy of proven performance, the company continues to leverage its expertise to deliver advanced, dependable and cost-effective propulsion systems for next-generation systems.
L3Harris has been producing GMLRS propulsion units for decades. By applying its extensive experience and advanced manufacturing techniques, the company has increased GMLRS output by nearly 80%, enhancing both delivery capacity and reliability.
The company’s state-of-the-art Engineering, Manufacturing and Development facility in Camden, AR, continues to expand to meet the nation’s urgent demand for solid rocket motors. With more than a decade of production experience, the facility now produces more than 115,000 solid rocket motors annually.
Growth Potential for LHX & Other Defense Stocks
According to a report by Fortune Business Insights, the global missile propulsion systems market is rapidly evolving, driven by technological advancements, geopolitical developments and increasing defense budgets. It is projected to witness a CAGR of 7.2% between 2025 and 2032.
Such growth prospects are favorable for L3Harris, which serves as the post-boost propulsion supplier for all current U.S. strategic deterrence weapon systems. Other defense contractors positioned to capitalize on the expanding global missile propulsion market are listed below:
Lockheed Martin Corp. LMT: The company is involved in the Missile Defense Agency’s Next Generation Interceptor program, utilizing advanced propulsion and sensor technologies to strengthen U.S. missile defense capabilities.
LMT has a long-term (three to five years) earnings growth rate of 12.35%. The Zacks Consensus Estimate for 2025 sales stands at $74.40 billion, which calls for an increase of 4.7%.
RTX Corporation RTX: The company is applying its advanced weapon expertise to develop air-breathing hypersonic scramjet systems, which use high-speed airflow for oxygen in propulsion and operate with a single solid rocket booster without any moving parts.
RTX has a long-term earnings growth rate of 10.35%. The Zacks Consensus Estimate for 2025 sales is pinned at $87.04 billion, which suggests a jump of 7.8%.
Northrop Grumman Corp. NOC: The company is one of the leading suppliers of solid rocket motors for U.S. strategic weapon systems. Its propulsion systems support the Ground-Based Midcourse Defense interceptor, Trident II D5, Minuteman III, Sentinel strategic missiles and emerging hypersonic programs.
NOC has a long-term earnings growth rate of 4.16%. The Zacks Consensus Estimate for 2025 sales is pegged at $41.89 billion, which implies a rise of 2.1%.
LHX Stock Price Movement
In the past six months, shares of L3Harris have risen 14.2% compared with the industry’s growth of 6.7%.
Image Source: Zacks Investment Research
LHX’s Zacks Rank
LHX currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Free Report: Profiting from the 2nd Wave of AI Explosion
The next phase of the AI explosion is poised to create significant wealth for investors, especially those who get in early. It will add literally trillion of dollars to the economy and revolutionize nearly every part of our lives.
Investors who bought shares like Nvidia at the right time have had a shot at huge gains.
But the rocket ride in the "first wave" of AI stocks may soon come to an end. The sharp upward trajectory of these stocks will begin to level off, leaving exponential growth to a new wave of cutting-edge companies.
Zacks' AI Boom 2.0: The Second Wave report reveals 4 under-the-radar companies that may soon be shining stars of AI’s next leap forward.
Access AI Boom 2.0 now, absolutely free >>Lockheed Martin Corporation (LMT) : Free Stock Analysis Report
Northrop Grumman Corporation (NOC) : Free Stock Analysis Report
L3Harris Technologies Inc (LHX) : Free Stock Analysis Report
RTX Corporation (RTX) : Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
