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Harris Secures Major US Army Deal

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Leading supplier of communications equipment and services, Harris Corporation (HRS), won two indefinite delivery, indefinite quantity (:IDIQ) deals from the U.S. army for the supply of Soldier Radio Waveform (SRW.V) vehicular appliqué systems.

The $988 million SRW Appliqué Radio Systems contract was divided among four companies, namely, Exelis Inc., General Dynamics, and Thales Defense & Security and Harris.

A Falcon III wideband radio and a small form factor wideband power amplifier make up the Harris SRW appliqué systems. These systems provide communication capabilities between headquarters, soldiers and their command centres. They also offer vehicular-based voice, video and data communication which aid situational awareness and command control activities. In 2012, the company had received initial orders for the appliqué system from the U.S. army.

Recently, Harris received a couple of contracts worth $131 million from undisclosed international countries. Notably, at the end of the second quarter of 2014, order backlog stood at $1,321 million, including $730 million in the Tactical Radio Communications segment and $591 million in the Public Safety and Professional Communications segment.

Harris reported mixed financial results for the second quarter of fiscal 2014 with the bottom line surpassing the Zacks Consensus Estimate but the top line missing the same. The company’s RF Communications segment is gathering momentum in international markets and this trend is likely to continue since Harris’ next-generation Falcon III tactical radio is gaining increasing market traction. Moreover, the company has raised its earnings outlook for 2014, mainly attributable to 3% annual growth in international military spending.

Currently, Harris Corporation has a Zacks Rank #3 (Hold).

Other Stocks to Consider

Other stocks to consider in the wireless equipment industry include Juniper Networks, Inc. (JNPR), ShoreTel, Inc. (SHOR) and Qualcomm Inc. (QCOM). While Juniper Networks and ShoreTel sport a Zacks Rank #1 (Strong Buy), Qualcomm holds a Zacks Rank #2 (Buy).

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