L3Harris Technologies
The dividend yield at L3Harris Technologies Inc. (NYSE: LHX) was 1.8% for the past 12 months. The company reported net income of $1.85 billion and paid out dividends totaling $826 million, for a payout ratio of 44.58%. For the next 12 months, the payout ratio is forecast to increase to 1.94%. Raytheon’s total return for the past year was 12.76%.
L3Harris posted total revenue of $18.19 billion in 2020, of which 82% ($14.94 billion) was attributable to defense. The company’s defense revenue grew by just 2% year over year in 2020.
Analysts are bullish on the stock, with 13 of 19 having a Buy or Strong Buy rating and another five rating the stock at Hold. At an average price target of $273.75, the implied upside over the next 12 months is 15%. The stock’s 52-week trading range is $200.71 to $279.71.
BAE Systems
U.K.-based BAE Systems is traded over the counter (BAESY) in the United States and in London (BA). The company paid a dividend yield of 3.57% over the past year. Its net income totaled $2.38 billion over the past 12 months, and the company paid out $1.05 billion in dividends for a payout ratio of 44.2%. For the next 112 months, the dividend yield is expected to rise to 4.32%. The total return for the past 12 months is 50.57%.
The company reported $24.74 billion in 2020 revenue, 95% ($23.5 billion) of which was attributable to its defense business, trailing only Lockheed in its dependence on defense spending.
Of 18 analysts covering the stock, half have a Hold rating and the other half have a Buy or Strong Buy rating. At an average price target of £7.92 (about $9.80), the implied share price gain over the next 12 months is 4.82%. BAE’s 52-week range is £5.11 to £7.82 (about $6.34 to $9.70).
General Dynamics
General Dynamics Corp. (NYSE: GD) paid a dividend yield of 2.12% over the past 12 months. The company reported net income for the period of $3.28 billion and paid out $1.33 billion in dividends, for a payout ratio of 40.56%. For the next 12 months, the dividend yield is forecast to rise to 2.32%. The company’s total return for the past year was 20.94%.
The company reported $37.9 billion in 2020 revenue, 79% ($29.8 billion) of which was attributable to its defense business. General Dynamics also reported an increase of just 1% year over year in its defense revenue for 2020. That is the lowest increase among these five stocks.
Of 16 analysts covering the company, 11 have a Buy or Strong Buy rating and four more rate the shares at Hold. At an average price target of $266.07, the implied 12-month gain to the share price is 17.74%. General Dynamics’ 52-week range is $182.66 to $254.99.
Note that General Dynamics is the only defense contractor among the Dividend Aristocrats. The company has increased its dividend for 31 consecutive years.
Originally posted at 24/7 Wall St.
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