L-3 Comm. Reaches 52-Week High - Analyst Blog
May 16 2013 - 7:30AM
Zacks
On May 15, 2013, the shares of
L-3 Communications Holdings Inc. (LLL) climbed to
its 52-week high of $85.29 primarily driven by strong results in
the first quarter of 2013 on strong international and commercial
operations. We believe that operational efficiency, few strategic
acquisitions, innumerable sizeable contracts and an effective cash
deployment strategy have also led the company’s share to attain
this high.
L-3 Communications continues to follow an effective cash deployment
strategy. In Feb 2013, the board of directors authorized to
repurchase up to an additional $1.5 billion of the company's common
stock through Jun 30, 2015. During first-quarter 2013, the company
repurchased $122 million of its common stock. Apart from share
buybacks, L-3 Communications paid $52 million through dividends
during the first quarter.
Going forward, we expect the incremental dividend and expanded
share buybacks to make the stock more attractive for the investors.
Moreover, the acquisitions of Kollmorgen Electro-Optical business
and Thales Group will enhance L-3 Communications’ market position
while expanding its commercial portfolio.
L-3 Communications provides a broad range of products and services
used in a number of aerospace and defense platforms. The company’s
Price to Book and Price to Sales multiples are lower than the peer
group average, which implies that the stock is trading at a
discount. It is making the shares of this company more
attractive.
L-3 Communications’ full-year 2013 earnings guidance ranges from
$8.15 to $8.35 per share, up from the year-ago figure of $8.01 per
share. The Zacks Consensus Estimate for full-year 2013 is $8.17 per
share, up 2.03% year over year. We expect the company’s long-term
earnings growth to be 0.88%.
L-3 Communications currently has a Zacks Rank #3 (Hold). Apart from
L-3 Communications, other stocks in the sector that are worth
considering include Erickson Air-Crane
Incorporated (EAC) with a Zacks Rank #1 (Strong Buy), and
Wesco Aircraft Holdings, Inc. (WAIR) and
Alliant Techsystems Inc. (ATK) with a Zacks Rank
#2 (Buy).
ALLIANT TECHSYS (ATK): Free Stock Analysis Report
ERICKSON AIR-CR (EAC): Free Stock Analysis Report
L-3 COMM HLDGS (LLL): Free Stock Analysis Report
WESCO AIRCRAFT (WAIR): Free Stock Analysis Report
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