11.11.2009 02:00 PM
Harris Beats Out Market by 40 Percent
CHICAGO, ILL. Harris’s recently reported fiscal first-quarter earnings per share of 83 cents beat by 9 percent the expectations of analysts at Zacks. Broadcast division revenues fell, but combined revenues rose nearly 3 percent to $1.2 billion.

Zacks’ Alex Kolb noted that Harris is generating a return on equity of around 25 percent compared to an industry average of around 3 percent.

“The company pays a dividend yield of 2 percent, while most of its industry peers pay no income,” he said.

Harris elevated its full fiscal 2010 guidance by 13 percent at the top end to $3.84 a share. Zacks boosted its outlook 16 percent, from $3.31 to $3.85 EPS for the fiscal year ending June 2010.

Kolb said shares of Harris (NYSE: HRS) are trading at a near 52-week high, outpacing the market by 40 percent over the last three months. Shares edged over $45 this morning, then fell to $44.64 at mid-day. Zacks gives Harris a “buy” recommendation for growth and income investing.

Harris is No. 13 on Washington Technology’s 2009 Top 100 list of the largest federal government prime contractors with more than $2.2 trillion in contracts. Harris’s most recent government contract comprises a $37 million order with a potential $18 million add-on.

More on Harris results:

October 28, 2009: “Harris Broadcast Fiscal 1Q Revenues Down 25 Percent
“Continued weakness in the first quarter was expected and reflects the global economy and delayed capital spending by broadcast and media customers, as well as seasonally slow spending, primarily in Europe and the Middle East.”

August 13, 2009: “Harris Beats the Street
Harris finished its fourth fiscal quarter with a loss of $156.4 million, but the stock price jumped on adjusted earnings.

June 1, 2009: Harris Plans for Broadcast Segment Impairment
As of the fiscal third quarter ended April 3, 2009, the book value of the goodwill and other intangible assets in the Broadcast Communications segment was $928 million. Harris expects to record a $250 million to $275 million non-cash charge in fiscal 4Q09.

May 5, 2009: Harris Broadcast Revenue Drops in Q3
“The impact of lower revenue on operating performance in the third quarter was mitigated by on-going cost-reduction actions.”

February 5, 2009: Harris Broadcast Revenue is Flat in 2Q
Order momentum “slowed significantly in the U.S. market during the first half of fiscal 2009 and is expected to remain weak during the next several quarters.” 


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