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Bethesda, Maryland-based Lockheed Martin Corporation (LMT) is a security and aerospace company that researches, designs, develops, manufactures, integrates, and sustains technology systems, products, and services. Valued at $135.3 billion by market cap, the company’s businesses span space, telecommunications, electronics, information and services, aeronautics, energy, and systems integration.
Shares of this leading global security, defense, and aerospace contractor have outperformed the broader market considerably over the past year. LMT has gained 26.4% over this time frame, while the broader S&P 500 Index ($SPX) has rallied nearly 24.3%. In 2024, LMT stock is up 25.1%, surpassing SPX’s 17.2% rise on a YTD basis.
Narrowing the focus, LMT has slightly lagged behind the iShares U.S. Aerospace & Defense ETF (ITA). The exchange-traded fund has gained about 26.8% over the past year. However, LMT’s gains on a YTD basis outshine the ETF’s 15.9% returns over the same time frame.
LMT’s overall performance can be attributed to its high-fidelity F-35 Full Mission Simulators, which provide advanced training for pilots. Its sales growth is driven by contracts for F-35 and F-16 programs, as well as production ramp-ups for GMLRS and LRASM programs. The acquisition of Terran Orbital Corporation (LLAP) and joint venture with General Dynamics Corporation (GD) are further strengthening Lockheed Martin's position in the defense industry.
On Jul. 23, LMT shares closed up more than 5% after reporting its Q2 earnings results. Its adjusted EPS of $7.11 topped Wall Street expectations of $6.45. The company’s revenue was $18.1 billion, surpassing forecasts of $17.1 billion. LMT updated its full-year guidance and expects its EPS to be between $26.10 and $26.60, while revenue is expected to be between $70.5 billion and $71.5 billion.
For the current fiscal year, ending in December, analysts expect LMT’s EPS to decline 4.2% to $26.65 on a diluted basis. The company’s earnings surprise history is impressive. It beat the consensus estimate in each of the last four quarters.
Among the 18 analysts covering LMT stock, the consensus is a “Moderate Buy.” That’s based on nine “Strong Buy” ratings, one “Moderate Buy,” seven “Holds,” and one “Strong Sell.”
This configuration is more bullish than a month ago with eight analysts suggesting a “Strong Buy.”
On Aug. 23, Seaport Global analyst Richard Safran maintained a “Buy” rating on LMT with a price target of $577, implying a potential upside of 1.8% from current levels.
While LMT currently trades above its mean price target of $545.15, the Street-high price target of $635 suggests an upside potential of 12%
On the date of publication, Neha Panjwani did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
