Harris Corporation (HRS - Analyst Report), a leader in the public safety and professional communications market, has won consecutive orders for its Falcon tactical radios from a NATO and a Central Asian country. Both the deals signify the growing popularity of the company’s radio products among the defense sectors of different countries.
Harris won an $11 million contract from the Ministry of Defense of a NATO country to provide them with Falcon III Secure Personal Radio (SPR). As an IDIQ (Indefinite Delivery Indefinite Quantity) contract, it can likely reach up to $20 million over the next one year.
Harris’ RF-7800S SPR advanced headsets and other related accessories will help the country’s soldiers to maintain voice communication in the rapidly changing circumstances. They can also share data and track each others position in the frontline with the help of this product.
Similarly, it has received another order worth $7 million for its Falcon tactical radio from a Central Asian nation. The radios will provide interoperable communications so as to support the international security forces in Afghanistan.
Melbourne-Florida based Harris will supply a wide range of radio products including Falcon III RF-7800S SPR, RF-7800M Multiband Networking Radio, RF-5800M handheld and RF-5800H manpack radios. The armed forces will get secure voice and high speed network data services across all levels of battlefield.
The Central Asian country, which is already a customer of Harris’ is upgrading its network with Harris’ Falcon III product. Earlier, in November the company won two $10 million plus contracts for its Falcon III tactical radios –one from two African nations and the other from US Air Force. This indicates the increased acceptance of the company’s Falcon III products among various military and Government organizations.
Recently, Harris declared its first-quarter fiscal 2013 results with Earnings per Share surpassing the Zacks Consensus Estimate. In the reported quarter, Tactical Radio Communications received new orders worth $254 million and has an order backlog of nearly $612 million.
Harris faces stiff competition from companies like Boeing Co. (BA - Analyst Report), General Dynamics Corp. (GD - Analyst Report) and Raytheon Co. (RTN - Analyst Report), which also provide high-end public safety communications system.
We are maintaining our long-term ‘Neutral’ recommendation on Harris Corporation. Currently, it holds a Zacks #3 Rank, implying a short-term Hold rating.