Story updated at 9:50 a.m. to reflect market activity.
L-3 fell -0.2% to $117.15 in morning trading.
The bank set a price target of $146 for the company. Bank of America-Merrill Lynch analysts said L-3 is seeing higher pension income and paying down its convertible debt.
Separately, TheStreet Ratings team rates L-3 COMMUNICATIONS HLDGS INC as a Buy with a ratings score of A-. TheStreet Ratings Team has this to say about their recommendation:
"We rate L-3 COMMUNICATIONS HLDGS INC (LLL) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its solid stock price performance, largely solid financial position with reasonable debt levels by most measures and attractive valuation levels. We feel these strengths outweigh the fact that the company has had sub par growth in net income."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- Compared to its closing price of one year ago, LLL's share price has jumped by 36.09%, exceeding the performance of the broader market during that same time frame. Regarding the stock's future course, although almost any stock can fall in a broad market decline, LLL should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
- The current debt-to-equity ratio, 0.60, is low and is below the industry average, implying that there has been successful management of debt levels. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.23, which illustrates the ability to avoid short-term cash problems.
- LLL, with its decline in revenue, slightly underperformed the industry average of 3.2%. Since the same quarter one year prior, revenues slightly dropped by 6.7%. The declining revenue appears to have seeped down to the company's bottom line, decreasing earnings per share.
- L-3 COMMUNICATIONS HLDGS INC' earnings per share from the most recent quarter came in slightly below the year earlier quarter. This company has reported somewhat volatile earnings recently. We feel it is likely to report a decline in earnings in the coming year. During the past fiscal year, L-3 COMMUNICATIONS HLDGS INC increased its bottom line by earning $8.54 versus $8.03 in the prior year. For the next year, the market is expecting a contraction of 1.6% in earnings ($8.40 versus $8.54).
- You can view the full analysis from the report here: LLL Ratings Report