We recently published a list of 16 Best 52-Week Low Stocks To Buy Now According to Short Sellers. In this article, we are going to take a look at where L3Harris Technologies, Inc. (NYSE:LHX) stands against the other 52-week low stocks.
The US stock market reached new all-time highs in late February 2025, as inflation remained near the 2% target while a potential end in the Ukraine conflict sparked some optimism for the long term. Besides the creation of multi-billion-dollar demand for potential rebuilding efforts of the country, including agriculture, residential, and infrastructure, the return of American business to Ukraine and Russia is a big win for most corporations, many of which could experience up to double-digit uplift in revenue and earnings growth due to up to 200 million customer market. More importantly, this outlook is favorable for energy security, stimulates volumes, and might push energy prices lower, which in turn allows for higher profitability.
Despite the aforementioned tailwinds, the US stock market gains are still largely driven by the Magnificent 8 companies, which trade at record-high valuations and have contributed to an unprecedented rise in the stock market concentration. These companies are anticipated to have tremendous growth opportunities arising from AI and data center megatrends, on top of existing rapidly growing niches like cloud computing, media streaming, SaaS, and others. Only time will tell whether the current valuations are fair; what is certain is that many industries have been struggling since 2022, as inflationary pressures followed by high interest rates and an increasingly tough labor market dominated by layoffs and scarcity of entry-level positions have put tremendous pressure on US consumers. The high financing costs have led to diminishing Capex appetite in many industries, leading to struggle in several market segments – perfectly illustrated by underperforming consumer discretionary and industrial sectors since 2022.
On top of harsh macro conditions in the last 3 years, the new “Trump 2.0” regime and his administration can be a threat for the healthcare sector. Trump is a notorious critic of the health insurance business and might create headwinds for it through attempts of deregulation and efforts to cut the government financing of healthcare programs. As a result, the healthcare sector relative to the overall market is at record lows comparable to the 2008 depression. All in all, despite apparent optimism in the market, there are pockets of underperformance and many companies trading near their 52-week low, which may present compelling opportunities to acquire good companies at attractive prices.
Our Methodology
We screened 30-40 stocks with at least $1 billion in market cap that are near their 52-week lows. Then we sorted them by open short interest as a percentage of outstanding shares and included the top 16 with the lowest open short interest in the article. Our belief is that a low open short interest implies a lack of bearish views on the business from leading hedge funds, which represents a bullish signal from a contrarian perspective.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 363.5% since May 2014, beating its benchmark by 208 percentage points (see more details here).
A military jetfighter against a deep blue sky with the sun behind it.
L3Harris Technologies, Inc. (NYSE:LHX)
Short Interest as % of Shares Outstanding: 1.33%
L3Harris Technologies, Inc. (NYSE:LHX) is a leading defense and aerospace technology company specializing in communication systems, electronic warfare, space systems, and mission-critical solutions. Serving the US Department of Defense, allied governments, and commercial customers, LHX delivers advanced technologies that enhance situational awareness, command and control, and national security. The company’s focus on innovation, including AI-driven defense solutions and next-generation space capabilities, positions it as a key player in modern warfare and global defense strategies.
The stock price of L3Harris Technologies, Inc. (NYSE:LHX) is down 25% since the November elections as the markets likely expect declining geopolitical turmoil under the “Trump 2.0” regime, which would translate into less warfare and military spending, including the company’s notorious counter-UAS systems. The fears were further amplified by active peace negotiations between the US and Russian officials in Saudi Arabia, which might result in an armistice in the near future, as well as hints and talks of the US army potentially ending its coverage of certain NATO territories. On top of that, the company itself reported the risk of some potential project cancellations in the space business, which is likely linked to the cautious stance of the new US administration regarding public spending. Despite these challenges, it is certain that the US will not completely mute its military spending, and L3Harris Technologies, Inc. (NYSE:LHX) remains a leader in its niche – management remains optimistic in areas like missile tracking, missile defense, and space-based capabilities, where it has strong past performance and existing assets in orbit. Furthermore, the company believes it is well-positioned to capitalize on the Iron Dome for America initiative, which aligns with its capabilities. With that in mind, it is of no surprise that short sellers are reluctant to bet against the company’s future – short interest stands at only 1.33% at a time when the stock price reached a new 52-week low.
Overall, LHX ranks 2nd on our list of the best 52-week low stocks to buy now according to short sellers. While we acknowledge the potential of LHX as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than LHX but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.
