Harris Earnings: Here’s Why Investors are Ambivalent Now

Harris Corp. (NYSE:HRS) delivered a profit and met Wall Street’s expectations, AND came up short on beating the revenue expectation. The revenue miss is a negative sign to shareholders seeking high growth out of the company.

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Harris Corp. Earnings Cheat Sheet

Results: Adjusted Earnings Per Share decreased 21.13% to $1.12 in the quarter versus EPS of $1.42 in the year-earlier quarter.

Revenue: Decreased 18.45% to $1.2 billion from the year-earlier quarter.

Actual vs. Wall St. Expectations: Harris Corp. reported adjusted EPS income of $1.12 per share. By that measure, the company missed the mean analyst estimate of $1.12. It missed the average revenue estimate of $1.21 billion.

Quoting Management: “Third quarter results were in line with our preliminary release issued April 11 and weaker than previously expected primarily due to U.S. and international tactical radio procurement delays,” said William M. Brown, president and chief executive officer. “U.S. Government funding constraints resulting from the continuing resolution were magnified when sequestration was triggered. Additionally, in the international market several key tactical radio orders have been pushed to later in the year or early next fiscal year.”

Key Stats (on next page)…

Revenue decreased 6.47% from $1.29 billion in the previous quarter. EPS decreased 10.4% from $1.25 in the previous quarter.

Looking Forward: Analysts have a more negative outlook for the company’s next-quarter performance. Over the past three months, the average estimate for next quarter’s earnings has fallen from a profit of $1.4 to a profit $1.14. For the current year, the average estimate has moved down from a profit of $5.05 to a profit of $4.65 over the last ninety days.

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(Company fundamentals provided by Xignite Financials. Email any earnings discrepancies to earnings [at] wallstcheatsheet.com)

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