L-3 Communications Holdings Inc

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LLL : NYSE : Industrial Goods
$161.58 up 3.1 | 2.0%
Today's Range: 158.5 - 161.61
Avg. Daily Volume: 585200.0
12/07/16 - 1:46 PM ET

Financial Analysis


L-3 COMMUNICATIONS HLDGS INC's gross profit margin for the third quarter of its fiscal year 2016 is essentially unchanged when compared to the same period a year ago. Even though sales decreased, the net income has increased, representing an increase to the bottom line. L-3 COMMUNICATIONS HLDGS INC has weak liquidity. Currently, the Quick Ratio is 0.92 which shows a lack of ability to cover short-term cash needs. The company's liquidity has decreased from the same period last year, indicating deteriorating cash flow.

During the same period, stockholders' equity ("net worth") has remained unchanged from the same quarter last year. Overall, the key liquidity measurements indicate that the company is in a position in which financial difficulties could develop in the future.

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Income Statement Q3 FY16 Q3 FY15
Net Sales ($mil)2505.02564.0
EBITDA ($mil)278.00.0
EBIT ($mil)229.0275.0
Net Income ($mil)148.0-299.0


Balance Sheet Q3 FY16 Q3 FY15
Cash & Equiv. ($mil)411.0323.0
Total Assets ($mil)11811.013036.0
Total Debt ($mil)3342.03949.0
Equity ($mil)4568.04584.0


Profitability Q3 FY16 Q3 FY15
Gross Profit Margin13.2112.71
EBITDA Margin11.090.0
Operating Margin9.1410.73
Sales Turnover0.880.81
Return on Assets3.010.98
Return on Equity8.7311.84
Debt Q3 FY16 Q3 FY15
Current Ratio1.461.74
Debt/Capital0.420.46
Interest Expense41.043.0
Interest Coverage5.596.4


Share Data Q3 FY16 Q3 FY15
Shares outstanding (mil)77.3679.0
Div / share0.70.65
EPS1.881.56
Book value / share59.0558.02
Institutional Own % n/a n/a
Avg Daily Volume570978.0562319.0

Valuation


BUY. L-3 COMMUNICATIONS HLDGS INC's P/E ratio indicates a premium compared to an average of 24.32 for the Aerospace & Defense industry and a premium compared to the S&P 500 average of 25.37. To use another comparison, its price-to-book ratio of 2.68 indicates valuation on par with the S&P 500 average of 2.81 and a significant discount versus the industry average of 16.06. The current price-to-sales ratio is well below the S&P 500 average and is also below the industry average, indicating a discount.


Price/Earnings
1 2 3 4 5
premium   discount
  Price/Cash Flow
1 2 3 4 5
premium   discount
LLL 31.19 Peers 24.32   LLL 12.35 Peers 16.36

Premium. A higher P/E ratio than its peers can signify a more expensive stock or higher growth expectations.

LLL is trading at a significant premium to its peers.

 

Discount. The P/CF ratio, a stock’s price divided by the company's cash flow from operations, is useful for comparing companies with different capital requirements or financing structures.

LLL is trading at a discount to its peers.

 
Price/Projected
Earnings
1 2 3 4 5
premium   discount
  Price to
Earnings/Growth
1 2 3 4 5
premium   discount
LLL 18.98 Peers 20.74   LLL 0.24 Peers 2.08

Average. An average price-to-projected earnings ratio can signify an industry neutral stock price and average future growth expectations.

LLL is trading at a valuation on par with its peers.

 

Discount. The PEG ratio is the stock’s P/E divided by the consensus estimate of long-term earnings growth. Faster growth can justify higher price multiples.

LLL trades at a significant discount to its peers.

 
Price/Book
1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
LLL 2.68 Peers 16.06   LLL -21.73 Peers 160.37

Discount. A lower price-to-book ratio makes a stock more attractive to investors seeking stocks with lower market values per dollar of equity on the balance sheet.

LLL is trading at a significant discount to its peers.

 

Lower. Elevated earnings growth rates can lead to capital appreciation and justify higher price-to-earnings ratios.

However, LLL is expected to significantly trail its peers on the basis of its earnings growth rate.

 
Price/Sales
1 2 3 4 5
premium   discount
  Sales Growth
1 2 3 4 5
premium   discount
LLL 1.18 Peers 1.62   LLL -1.55 Peers 3.81

Discount. In the absence of P/E and P/B multiples, the price-to-sales ratio can display the value investors are placing on each dollar of sales.

LLL is trading at a significant discount to its industry on this measurement.

 

Lower. A sales growth rate that trails the industry implies that a company is losing market share.

LLL significantly trails its peers on the basis of sales growth

 

 

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