It is our recommendation to exit our position in Harris and realize a gain of 15%. Although the company did come out with EPS that beat estimates they missed on margins and top-line revenue. Going forward we see top-line revenue and margins under continued pressure. The cut back in U.S defense spending, will likely lead to the Department of Defense looking for more 'bang for their buck' squeezing margins further. Some risks associated with the company that had not materialized when it was purchased, have since materialized. Weak new orders in the 2QFY12 drove a poor book-to-bill, specifically in the RF segment, and management again revising top-line revenue forecasts down. These material issue have led us to believe that at current levels HRS possesses more downside risk than upside potential.