L3Harris Technologies vs Northrop Grumman Which Is More Favorable?
L3Harris Technologies and Northrop Grumman are two prominent companies in the defense industry, providing a wide range of products and services to military and government clients. Both companies have seen fluctuations in their stock prices due to various factors, including government contracts, geopolitical events, and technological advancements. Investors are closely monitoring the performance of these stocks to assess their potential for growth and profitability in the highly competitive defense sector. In this analysis, we will compare and contrast the stock performance of L3Harris Technologies and Northrop Grumman to provide insights into their investment potential.
L3Harris Technologies or Northrop Grumman?
When comparing L3Harris Technologies and Northrop Grumman, different investors may prioritize various metrics based on their investment strategies and goals. So, ask yourself what type of investor you are. This will guide you in determining which metrics are most important for your investment decision between L3Harris Technologies and Northrop Grumman.
Dividend Investors:
Dividend investors look for stable and growing income streams, using dividend metrics to assess potential investments. A company's dividend yield essentially measures the size of its dividend relative to the total market value of the company.
L3Harris Technologies has a dividend yield of 2.2%, while Northrop Grumman has a dividend yield of 1.74%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. L3Harris Technologies reports a 5-year dividend growth of 10.08% year and a payout ratio of 58.99%. On the other hand, Northrop Grumman reports a 5-year dividend growth of 9.30% year and a payout ratio of 28.41%.
Value Investors:
Value investors focus on financial metrics to determine a stock's intrinsic value compared to its market value. The Price-to-Earnings (P/E) Ratio links stock price to a company's earnings per share, with L3Harris Technologies P/E ratio at 26.58 and Northrop Grumman's P/E ratio at 16.58. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. L3Harris Technologies P/B ratio is 2.05 while Northrop Grumman's P/B ratio is 4.52.
Growth Investors:
Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, L3Harris Technologies has seen a 5-year revenue growth of 0.34%, while Northrop Grumman's is 0.40%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with L3Harris Technologies's ROE at 7.90% and Northrop Grumman's ROE at 28.51%.
Retail Investors:
Retail investors often consider stock affordability and company familiarity. For example, day low prices are $205.75 for L3Harris Technologies and $466.59 for Northrop Grumman. Over the past year, L3Harris Technologies's prices ranged from $193.09 to $265.74, with a yearly change of 37.62%. Northrop Grumman's prices fluctuated between $418.60 and $555.57, with a yearly change of 32.72%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.
