L3Harris Technologies, Inc. (LHX Quick QuoteLHX - Free Report) recently secured a -rate production order for the U.S. Army’s HMS (Handheld, Manpack, & Small Form Fit) program. As part of the deal, L3Harris will provide advanced multi-channel, multi-mission communications tactical radio solutions for the U.S. Army, supporting their Integrated Tactical Network.

Valued at more than $200 million, the U.S. Army awarded L3Harris with order for the multi-channel software-defined Falcon IV AN/PRC-163 handheld Leader Radios and AN/PRC -158 manpack radios. The deal may include delivery of 100,000 two-channel Leader Radios and 65,000 HMS Manpack radios to the Army.

 

Also, the order comprises  a five-year base for the Army’s Indefinite Delivery Indefinite Quantity contracts for the handheld Leader and manpack radios with an additional five-year option, and a ceiling of more than $16 billion.

 

Importance of AN/PRC-163 and AN/PRC -158 Radios

Intense geo-political tensions globally have resulted in countries strengthening their defense system. In this context, Integrated Tactical Network forms an integral part of defense, as seamless connection is important at all levels of the defense system. The effective network system makes interoperability easier for the army. It also ensures better security within the military services.

 

In this context, it is imperative to mention that L3Harris’s AN/PRC-163 and AN/PRC -158 Radios offer features that can support the U.S Army’s Integrated Tactical Network effectively. AN/PRC-163 provides simultaneous multi-channel communications, advanced SA (situational awareness) and ISR (Intelligence, Surveillance and Reconnaissance) Video mission module, and AN/PRC -158 Radiosare capable of meeting all JTRS COMSEC and TRANSEC requirements, thus transmitting and receiving voice and data simultaneously.

 

Such enhanced features must have made these two radios the ideal choice for the U.S Army for its Integrated Tactical Network program. The latest deal is a testament to that.

The U.S. Army’s continuous effort to modernize the entire network system with software defined radio technologies are the driving factors behind the surge in demand for advanced tactical radios. 

 

This is quite evident from the allocation of a $5.6 billion investment plan for cybersecurity, which includes network modernizations, in the U.S. fiscal 2022 defense budget. Without a doubt, this implies strong inflow of orders for L3Harris going forward.

 

Other defense majors that would reap the benefits of strong demand for advanced communication system are Lockheed Martin (LMT Quick QuoteLMT - Free Report) , Northrop Grumman (NOC Quick QuoteNOC - Free Report) and Raytheon Technologies Corp (RTX Quick QuoteRTX - Free Report) .

 

Lockheed Martin’s Whetstone network system was developed to extend communications to soldiers out of range of conventional networks,while Northrop Grumman’s Battlefield Airborne Communications Node provides warfighters with essential information to pursue and defeat the enemy. Raytheon’s AN/ARC-210(V),whichisequipped at more than 200 platforms, provides warfighterswith Line-Of-Sight (LOS) UHF/VHF (AM/FM) anti-jam secure voice/data communications and Beyond LOS Satellite Communications (SATCOM).

In the past year, shares of L3Harris have gained 24.9% compared with the industry’s growth of 11.5%.

 

L3Harris currently carries a Zacks #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.