Hold - Price 28.87 on March 31
by Morgan Joseph

Melbourne, Fla.-based Harris provides communications systems to government and commercial end markets. [As expected], Harris announced distribution of approximately 33 million shares of Harris Stratex (HSTX-NNM) that the company owns. The HSTX shares are to be spun off in the form of a taxable pro rata stock dividend...given the lack of strategic alternatives in current markets. We don't expect the spinoff stock dividend to affect shares outstanding for Harris or Harris Stratex. Despite the company's opportunities, we still have concerns about near-term bookings....But we believe Harris remains well-positioned to benefit from...likely increase[s in] government expenditures on communications technology....The spinoff increases the probability of a goodwill charge. Market cap: $3.8 billion.

PE of 11, a PEG of 0.51, and it pays a yield of 2.4%.

Military contractor L-3 Communications (LLL) joined the portfolio because of its 1.5% yield and dividend CAGR of 34%, and Harris (HRS), a communications and information-technology outfit, was bought because of its 2.5% yield and five-year dividend CAGR of 31%.

Harris (HRS) was upgraded from underweight to neutral at JPMorgan. Stock has underperformed, and is already pricing in a slowdown in the RF business.

33.0%

In line with its long-term target of sustained dividends in the range of 20% of net income, Harris Corp.(HRS) Monday boosted its common payout for the seventh consecutive year. The Melbourne, Fla., international provider of communications and information technology set a new quarterly of 20 cents a share, up 33% from 15 cents. Disbursement is scheduled for Sept. 17 to investors of record Sept. 4. The stock goes ex-dividend Sept. 2. Harris, which has annual revenues of $5.3 billion, has paid dividends continually since 1941.

Harris (HRS) was downgraded from Neutral to Underweight, JP Morgan said. Estimates also cut, as the RF growth outlook could sputter later in the year.

High-performing technology stock

terrific groth stock

super fundies

??