Lockheed Martin (LMT) AI Stock Analysis

• Market Cap: $109.71B
• Dividend Yield: 2.76%
• Average Volume (3M): 1.37M
• Price to Earnings (P/E): 26.5
• Beta (1Y): 0.21
• Revenue Growth: 2.88%
• EPS Growth: -35.15%
• Country: US
• Employees: 121,000
• Sector: Industrials
• Sector Strength: 72
• Industry: Aerospace & Defense
• EPS (TTM): 6.95
• Shares Outstanding: 231,397,800
• 10 Day Avg. Volume: 1,593,002
• 30 Day Avg. Volume: 1,365,257
• PEG Ratio: -1.14
• Price to Book (P/B): 18.29
• Price to Sales (P/S): 1.63
• P/FCF Ratio: 21.90
• Enterprise Value/Market Cap: 1.20
• Enterprise Value/Revenue: 1.80
• Enterprise Value/Gross Profit: 22.08
• Enterprise Value/Ebitda: 17.20
• 1Y Price Target: $524.93
• Price Target Upside: 8.55% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 14
• EPS Forecast (FY): 22.22
• Revenue Forecast (FY): $74.58B

• Rating: 70 Outperform
• Price Target: $534.00 ▲(10.43% Upside)

Lockheed Martin's overall stock score reflects strong earnings performance and a positive outlook, driven by a record backlog and significant contract wins. However, high leverage and valuation concerns weigh on the score. The company's strategic moves to manage liabilities and enhance liquidity are positive, but declining profit margins and supply chain challenges remain risks.

Positive Factors

Record Backlog

A record backlog provides long-term revenue visibility and stability, ensuring sustained production and financial performance.

Cash Flow Generation

Strong cash flow generation supports shareholder returns and provides capital for reinvestment, enhancing financial resilience.

New Credit Facility

The new credit facility enhances financial flexibility, supporting liquidity and operational stability for future growth.

Negative Factors

Declining Profit Margins

Declining margins indicate rising costs or pricing pressures, potentially impacting long-term profitability and competitiveness.

High Leverage

High leverage can strain financial flexibility and increase risk, potentially affecting future investment and growth opportunities.

Supply Chain Challenges

Supply chain issues can delay production and delivery, impacting revenue and operational efficiency over the long term.

Lockheed Martin Business Overview & Revenue Model

Company Description

Lockheed Martin Corporation, a security and aerospace company, engages in the research, design, development, manufacture, integration, and sustainment of technology systems, products, and services worldwide. It operates through four segments: Aeronautics, Missiles and Fire Control, Rotary and Mission Systems, and Space. The Aeronautics segment offers combat and air mobility aircraft, unmanned air vehicles, and related technologies. The Missiles and Fire Control segment provides air and missile defense systems; tactical missiles and air-to-ground precision strike weapon systems; logistics; fire control systems; mission operations support, readiness, engineering support, and integration services; manned and unmanned ground vehicles; and energy management solutions. The Rotary and Mission Systems segment offers military and commercial helicopters, surface ships, sea and land-based missile defense systems, radar systems, sea and air-based mission and combat systems, command and control mission solutions, cyber solutions, and simulation and training solutions. The Space segment offers satellites; space transportation systems; strategic, advanced strike, and defensive missile systems; and classified systems and services in support of national security systems. This segment also provides network-enabled situational awareness and integrates space and ground-based systems to help its customers gather, analyze, and securely distribute critical intelligence data. It serves primarily serves the U.S. government, as well as foreign military sales contracted through the U.S. government. Lockheed Martin Corporation was founded in 1912 and is headquartered in Bethesda, Maryland.

How the Company Makes Money

Lockheed Martin generates revenue through various key streams, primarily driven by government contracts with the U.S. Department of Defense and other international defense agencies. The Aeronautics sector contributes significantly through the production of military aircraft such as the F-35 Lightning II and the C-130 Hercules, while the Missiles and Fire Control sector provides advanced missile systems and defense technologies. Revenue is also bolstered by contracts in the Space sector, which includes satellite systems and space exploration initiatives. Additionally, Lockheed Martin engages in partnerships with other defense contractors, government entities, and international organizations, further enhancing its revenue potential. The company also invests in research and development to innovate and expand its product offerings, which can lead to new contracts and revenue opportunities.

Lockheed Martin Financial Statement Overview

Summary

Lockheed Martin exhibits a stable financial profile with consistent revenue growth and strong operational efficiency. Despite challenges in profitability margins and free cash flow reduction, the company has successfully reduced leverage and improved its balance sheet strength. The overall financial health remains robust, though attention to profitability improvements and cash flow generation is needed.

Income Statement

Lockheed Martin's income statement shows a stable revenue growth trajectory with a TTM (Trailing-Twelve-Months) revenue of $71.8 billion, up from $71.0 billion in 2024. The gross profit margin has slightly decreased to 8.16% from 9.75% in 2024, indicating potential cost challenges. The net profit margin also declined to 5.85% from 7.51%, reflecting reduced profitability. However, EBITDA margin remains strong at 11.21%, showcasing operational efficiency.

Balance Sheet

The balance sheet indicates a robust equity position with a debt-to-equity ratio improvement to 0.58 from 3.20 in 2024, highlighting reduced leverage. The equity ratio stands at 9.06%, reflecting a manageable level of equity in total assets. However, the ROE has decreased to 78.81% from 84.26%, indicating a slight dip in shareholder returns. Overall, the company maintains a stable financial position with adequate equity and reduced debt levels.

Cash Flow

Cash flow analysis reveals a decrease in free cash flow to $3.33 billion from $5.29 billion in 2024, indicating a reduction in liquidity generation. The operating cash flow to net income ratio is healthy at 1.21, suggesting efficient cash generation from operations. The free cash flow to net income ratio has decreased to 0.79, reflecting reduced cash retention. Overall, the cash flow statement shows stable operational cash flows but highlights a decline in free cash flow generation.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	73.35B	71.04B	67.57B	65.98B	67.04B	65.40B
Gross Profit	5.99B	6.93B	8.48B	8.29B	9.06B	8.65B
EBITDA	7.68B	8.82B	10.44B	8.71B	9.48B	10.12B
Net Income	4.20B	5.34B	6.92B	5.73B	6.32B	6.83B
Balance Sheet
Total Assets	60.28B	55.62B	52.46B	52.88B	50.87B	50.71B
Cash, Cash Equivalents and Short-Term Investments	3.47B	2.48B	1.44B	2.55B	3.60B	3.16B
Total Debt	22.19B	21.42B	17.46B	15.55B	11.68B	12.17B
Total Liabilities	54.09B	49.28B	45.62B	43.61B	39.91B	44.67B
Stockholders Equity	6.18B	6.33B	6.83B	9.27B	10.96B	6.01B
Cash Flow
Free Cash Flow	4.59B	5.29B	6.23B	6.13B	7.70B	6.42B
Operating Cash Flow	6.36B	6.97B	7.92B	7.80B	9.22B	8.18B
Investing Cash Flow	-2.30B	-1.79B	-1.69B	-1.79B	-1.16B	-2.01B
Financing Cash Flow	-3.74B	-4.14B	-7.33B	-7.07B	-7.62B	-4.53B

Lockheed Martin Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 483.57
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For LMT, the sentiment is Positive. The current price of 483.57 is above the 20-day moving average (MA) of 464.23, above the 50-day MA of 470.43, and above the 200-day MA of 459.37, indicating a bullish trend. The MACD of 4.40 indicates Negative momentum. The RSI at 60.58 is Neutral, neither overbought nor oversold. The STOCH value of 82.45 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for LMT.

Lockheed Martin Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
GD	80 Outperform	$91.67B	21.99	17.78%	1.73%	11.86%	17.39%
NOC	76 Outperform	$81.13B	20.41	26.15%	1.54%	-0.14%	72.35%
GE	72 Outperform	$324.05B	40.96	42.74%	0.48%	-19.21%	31.83%
LMT	70 Outperform	$109.71B	26.47	62.78%	2.76%	2.88%	-35.15%
LHX	70 Neutral	$53.77B	30.87	9.13%	1.63%	2.83%	47.00%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
BA	54 Neutral	$167.64B	―	―	―	10.19%	-6.03%

Lockheed Martin Corporate Events

Lockheed Martin Transfers Pension Obligations to Insurers

On December 16, 2025, Lockheed Martin executed buy-out conversions of previously purchased group annuity contracts, transferring approximately $900 million of gross defined benefit pension obligations from its pension plans to certain insurance companies at no additional cost or funding contribution to the company. Following the conversions, the insurers legally assumed responsibility for paying and administering retirement benefits for about 9,000 U.S. retirees and beneficiaries, with no change to the nature, amount, or timing of benefits, while Lockheed Martin expects to record a non-cash, non-operating pretax settlement charge of roughly $480 million in the fourth quarter of 2025, which represents accelerated recognition of actuarial losses and was not included in its prior 2025 financial outlook.

Lockheed Martin Secures New $3 Billion Credit Facility

On December 5, 2025, Lockheed Martin entered into a new 364-Day Revolving Credit Agreement with a $3.0 billion unsecured revolving credit facility involving multiple banks. This agreement, which matures on December 4, 2026, supports the company’s financial flexibility for corporate purposes, including commercial paper borrowings, and reflects its strategic financial management to maintain liquidity and operational stability.