HRS Harris Corp.

A leading supplier of communications equipments and services, Harris Corp. (HRS) is currently looking for a successor to Howard L.Lance, the current chairman, president and CEO. Lance, aged 55, joined Harris in 2003 and plans to retire in the second half of 2012.  

The company has appointed an executive search firm to aid them in the process of selecting the right candidate for the highly recognized post.

Lance, the former president of NCR Corporation succeeded Phillip W. Farmer as the president and CEO of Harris in January 2003 and became the chairman of the company later that year. 

During his tenure, the company witnessed consistent growth across all its operations. Revenue and earnings per share (EPS) grew at a six-year (2004-2010) compounded annual growth rate (CAGR) of 18% and 54%, respectively.

Harris reported modest third quarter 2011 financial results, where GAAP net income in the quarter was $140 million or $1.09 per share compared with a net income of $166 million or $1.26 per share in the year-ago quarter, while the quarterly adjusted (excluding special charges) EPS of $1.16 beat the Zacks Consensus Estimate by a penny. However, consolidated revenue for the third quarter of 2011 was $1,413.3 million, which failed to beat the Zacks Consensus Estimate of $1,514.0 million but improved 6.3% year over year.

Harris operates in a highly competitive communication equipment industry and faces intense competition from Boeing Co. (BA), General Dynamics Corp. (GD) and Raytheon Co. (RTN). 

We thus maintain our long-term Neutral recommendation for Harris Corporation. Currently, Harris Corporation has a Zacks #3 Rank, implying a short-term Hold rating on the stock.

 
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