On June 16, 2025, LMT fell around 3.5%, trading down to ~$471 before closing around $469 This was after a general defense stock pullback—Northrop Grumman and L3Harris followed Lockheed in declining more than 3%. Catalysts probably are:
- Profit-taking after Friday’s sector rebound
- Fading geopolitical tensions, especially Iran indicating de-escalation
Pentagon reports trimming Air Force’s F‑35 order in half—from 48 to 24—eliciting investor skepticism
Analyst Downgrades and Upgrades
A combination of ratings changes and target reductions in Q2:
- RBC downgraded from Outperform to Sector Perform; target reduced from $550 → $480
- Wells Fargo reduced its target from $476 → $432, assigning an Equal Weight rating
- Morgan Stanley upgraded to Overweight with a $575 target
- Robert W. Baird upgrade to Outperform (later Strong Buy), with a $540
Consensus view: 9 Holds, 8 Buys, 1 Strong Buy = Moderate Buy, average target ≈ $541.80
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Lockheed Martin Stock Performance
- Current price: ~$467 (down ~0.04% intraday)
- 52‑week range: ~$419 – $619
- Technical: 50‑day SMA ~$471; 200‑day SMA ~$469
Financial ratios:
- Market cap ≈ $109 billion–$113 billion
- P/E ~21, PEG ~2.1, Beta ~0.3
Q1 2025 Earnings Recap
- EPS: $7.28 vs. $6.34 expected (+14.8%)
- Revenue: $17.96B vs. $17.83B expected
- Strong guidance confirmed: sales $73.75–74.75B; EPS $27–27.30
Lockheed also confirmed a strong $173 billion backlog, representing more than two years of revenue
Lockheed Martin Declares Dividend
- Quarterly dividend: $3.30 per share
- Annualized dividend: $13.20 → yield ~2.7–2.8%
- Ex-dividend date: June 2, 2025
- Payment date: June 27, 2025
- Payout ratio: ~56% (EPS $7.28 vs. dividend $13.20)
Lockheed has grown dividends 23 consecutive years, reflecting financial discipline
Company Overview
Established March 15, 1995, through the Lockheed–Martin Marietta merger, Lockheed Martin has four segments: Aeronautics, Missiles & Fire Control, Rotary & Mission Systems, and Space. Located in Bethesda, MD, with ~121,000 employees and 2024 revenues of $71B and net income $5.34B
The company occupies a leading position as a top U.S. defense contractor with large systems such as the F‑35, Sikorsky helicopters, Aegis systems, Orion spacecraft, etc.
Recent News
- F‑35 purchase cut: Pentagon reducing 2025 Air Force request (48 → 24), along with cuts to Navy/Marines, precipitating a ~7% intraday drop and subsequent 4–5% declines.
- Geopolitical shift: Defense stocks fell in spite of Middle East tensions, indicating market optimism.
- Rare earths supply: U.S.–China negotiations left out rare‑earth magnets used by F‑35s; China maintains tight grip, propelling domestic rare‑earth stocks.
Financials
From Q1 2025 earnings
- Revenue: $17.96B (+4.5% YoY)
- Net margin: ~7.5%
- ROE: ~101%
- Backlog: $173B
Projections (full year): EPS $27–27.30, Revenue $73.75–74.75B
Final Thought
In brief, Lockheed Martin’s recent slump is a combination of sector rotation, F‑35 buying cuts, and geopolitical cues. Fundamental underpinnings—good earnings, healthy backlog, and stable dividend—remain in place. Investors need to weigh those positives against persisting defense budget dynamics and supply chain issues.
Frequently Asked Questions (FAQs)
Q: Why did Lockheed fall 3.5%?
A: Mix of profit-taking on Friday gains, defense-sector broad pullback, and news of decreased F-35 orders by the Air Force due to geopolitical subtlety.
Q: What’s dividend yield and pay date?
A: Yield ~2.7–2.8% annualized, quarterly $3.30. Ex-div June 2, payment June 27, 2025.
Q: Is the dividend secure?
A: Yes—payout ratio ~56%, supported by robust free cash flow and 23 consecutive years of growth.
Q: Were earnings ahead of expectations?
A: Yes—EPS $7.28 vs $6.34 expected; revenue $17.96B vs $17.83B expected. Full-year guidance confirmed.
Q: How about the F‑35 order reduction?
A: The Pentagon’s 2025 Air Force request fell from 48 to 24 aircraft. That triggered a ~7% decrease day-off, although later gains reversed some losses .
Q: Do I buy the dip?
A: That is dependent on your strategy. LMT has a good dividend and backlog, so be wary of defense spending trends, F-35 production, and rare-earth supply threats.
