L3Harris Technologies (LHX) Secures $1 Billion Investment for Rocket Motor Spin-off
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Jan 13 2026
0mins
Should l Buy LHX?
Source: stocktwits
- Significant Investment: The U.S. Department of Defense will invest $1 billion in L3Harris' rocket motor business, indicating strong governmental support for the sector and expected to drive future growth for the company.
- Business Spin-off: L3Harris announced the spin-off of its rocket motor business into a new publicly traded company, planning to convert the investment into common equity in 2026 through convertible securities, enhancing its capital structure.
- Stock Price Reaction: Following the announcement, L3Harris shares rose over 11%, reflecting a positive market response to the investment, with retail investor sentiment trending bullish.
- Market Outlook: This investment not only provides financial backing for L3Harris but may also attract more investor interest in the upcoming IPO of the new company, further enhancing its competitive position in the market.
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Analyst Views on LHX
Wall Street analysts forecast LHX stock price to fall
14 Analyst Rating
11 Buy
3 Hold
0 Sell
Strong Buy
Current: 353.910
Low
212.00
Averages
253.50
High
280.00
Current: 353.910
Low
212.00
Averages
253.50
High
280.00
About LHX
L3Harris Technologies, Inc. provides end-to-end technology solutions connecting the space, air, land, sea and cyber domains in the interest of national security. Its segments include Space & Airborne Systems (SAS), Integrated Mission Systems (IMS), Communication Systems (CS), and Aerojet Rocketdyne (AR). The SAS segment supplies full mission solutions as a prime and subsystem integrator in the space, airborne and cyber domains. The IMS segment delivers differentiated mission capabilities and prime systems integration to support intelligence, reconnaissance and surveillance (ISR), passive sensing and targeting, electronic attack, autonomy, power and communications, networks and sensors. CS enables warfighters across all domains with solutions critical to mission success even in the contested environments. The AR segment provides propulsion, power and armament products and systems to the U.S. Government, including the DoD, NASA and various aerospace and defense prime contractors.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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- Technical Support: The company supplied over 100 separate elements for the mission, including RS-25 and RL10 engines, ensuring precise control and monitoring of the spacecraft, further solidifying its leadership in aerospace technology.
- Mission Significance: The 10-day lunar mission will demonstrate L3Harris's capabilities in support of the Artemis campaign, aligning with NASA's vision for a sustained human presence on the moon, which holds significant strategic implications.
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- Rising Demand: Since the end of February, following U.S. and Israeli military actions against Iran, defense tech startups have reported a significant uptick in demand from Department of Defense customers, with many clients offering to buy out capacity or requesting increased production, indicating a pressing market need for new technologies.
- Opportunities in the Middle East: As conflicts escalate, defense tech startups in Europe and the U.S. are accelerating commercial discussions with Middle Eastern governments, particularly as interest from Gulf states skyrockets, highlighting urgent needs for defenses against drone and missile attacks.
- Human Resource Expansion: In response to the Iran war, European-headquartered defense startups are set to increase staffing in the Middle East, with Estonian startup Frankenburg and Ukrainian-UK Uforce both indicating plans to ramp up hiring in the region to meet the surging market demand.
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See More
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See More
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See More
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- Historic Launch: L3Harris successfully powered the Artemis II mission, providing propulsion and avionics for the first crewed lunar journey in over 50 years, showcasing the company's technological prowess and market position in the aerospace sector.
- Technical Support: The company supplied over 100 separate elements for the mission, including RS-25 and RL10 engines, ensuring precise control and monitoring of the spacecraft, further solidifying its leadership in aerospace technology.
- Mission Significance: The 10-day lunar mission will demonstrate L3Harris's capabilities in support of the Artemis campaign, aligning with NASA's vision for a sustained human presence on the moon, which holds significant strategic implications.
- Corporate Vision: L3Harris CEO Christopher Kubasik emphasized the company's commitment to supporting the successful completion of the Artemis II mission, reflecting its dedication and mission in the defense technology sector.
See More
Surge in Defense Tech Investments Amid Geopolitical Tensions
- Significant Investment Growth: According to Dealroom, defense tech funding was only $869 million globally in 2020, but is projected to surge to $11.2 billion by 2025, reflecting a more than tenfold increase driven by rising geopolitical tensions and demand for defense technologies.
- Rising Demand: Since the end of February, following U.S. and Israeli military actions against Iran, defense tech startups have reported a significant uptick in demand from Department of Defense customers, with many clients offering to buy out capacity or requesting increased production, indicating a pressing market need for new technologies.
- Opportunities in the Middle East: As conflicts escalate, defense tech startups in Europe and the U.S. are accelerating commercial discussions with Middle Eastern governments, particularly as interest from Gulf states skyrockets, highlighting urgent needs for defenses against drone and missile attacks.
- Human Resource Expansion: In response to the Iran war, European-headquartered defense startups are set to increase staffing in the Middle East, with Estonian startup Frankenburg and Ukrainian-UK Uforce both indicating plans to ramp up hiring in the region to meet the surging market demand.
See More
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- Contract Award: Mercury Systems has been awarded a contract by L3Harris to provide solid-state data recorders (SSDRs) for the U.S. Space Development Agency, enhancing its market position in defense and potentially driving future revenue growth.
- Technology Application: Mercury's radiation-tolerant SSDRs will be utilized across all four tranches of tracking layer satellites developed by L3Harris, particularly for the 18 infrared satellites in Tranche 3, thereby improving the U.S. defense capabilities against advanced missile threats.
- Manufacturing Capacity Boost: Mercury is proactively increasing its manufacturing capacity and efficiency to meet the accelerating hardware production demands across all battlefield domains in the U.S., which will help the company maintain its competitive edge in a challenging market.
- Market Impact: The signing of this contract not only showcases Mercury's innovative capabilities in critical technology areas but also positions the company to secure more orders in future defense projects, further solidifying its market share.
See More
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- New Modem Launch: L3Harris and Comtech have jointly developed the 5650C2/MP modem, capable of connecting to satellites in medium, geosynchronous, and highly elliptical orbits, addressing the growing demand for resilient military communications and enhancing system flexibility and reliability.
- Multi-Network Connectivity: The device is designed to work with L3Harris's portable satellite terminals, enabling field operators to access multiple networks using a single piece of hardware, thereby simplifying deployment and reducing equipment burdens in the field.
- Certification Process Underway: The modem is undergoing certification with the U.S. Space Force, and if approved, it will operate across both commercial and military satellite constellations, potentially decreasing the need for multiple modems in deployed environments.
- Software-Defined Architecture: Built on a software-defined architecture, the modem allows for reconfiguration based on mission requirements and supports communication waveforms designed to resist interference and jamming, ensuring stable communication in contested electromagnetic environments.
See More
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- Earnings Release Schedule: L3Harris Technologies will announce its Q1 2026 financial results before the market opens on April 30, indicating the company's ongoing commitment to transparency and growth in the defense technology sector.
- Conference Call Timing: The company will host an earnings call on the same day at 10:30 AM ET, allowing investors to engage and interact with management, thereby enhancing communication.
- Replay Availability: A replay of the earnings call will be accessible on L3Harris.com following the event, ensuring that investors who cannot attend live can still access critical information.
- Company Background: L3Harris Technologies focuses on defense technology, providing end-to-end solutions that connect space, air, land, sea, and cyber domains, underscoring its vital role in national security.
See More
European Defense Tech Startups Accelerate Engagement with Middle East Governments
- Surge in Commercial Discussions: Since the onset of the Iran war, European defense tech startups have significantly ramped up commercial discussions with Middle Eastern countries, particularly Gulf states, which are experiencing skyrocketing demand for drone and missile interception technologies, potentially leading to order volumes in the thousands of missiles.
- Expedited Delivery Plans: CEO of Frankenburg Technologies noted that commercial conversations with Gulf states have accelerated, with ongoing discussions about procuring their technology and plans to meet demand under an 'expedited delivery schedule', highlighting the urgent market need for defense technologies.
- Emerging Market Opportunities: Uforce's CEO indicated that interest from Gulf states in their defense technologies has 'skyrocketed' since the Iran war began, with plans to establish a permanent team in the Middle East to address the growing demand, reflecting the region's thirst for advanced defense solutions.
- Funding and Investment Surge: According to Dealroom, European defense tech startups raised $1.8 billion in 2025, nearly three times the previous highest annual figure, indicating that rising global geopolitical tensions are driving a surge in investment in defense technologies.
See More
