Lockheed Martin (LMT) — Company Research

Last Updated: 19 Oct 2026

Lockheed Martin (NYSE: LMT) is one of the world’s largest defence contractors. It makes the F-35 fighter, the PAC-3 and THAAD missile-defence interceptors, Sikorsky helicopters, the Trident II D5 submarine-launched missile and a range of satellites and space systems. FY2025 net sales were a record $75.0bn, but about $7 a share of programme losses and other charges held GAAP EPS to $21.49. In 2026 earnings have recovered, record missile orders took backlog to $230.4bn, and in July management raised its 2026 outlook to EPS of $29.95–30.65. This refreshed report covers results through Q2 2026, the balance sheet at 28 Jun 2026, valuation and risks, using company releases and SEC filings only. Q3 2026 results are due on 22 Oct 2026.

1. Company Snapshot

Field	Value
Ticker / Exchange	LMT / NYSE
CEO / Leadership	Jim Taiclet, Chairman, President & CEO; Evan Scott, CFO; OJ Sanchez, President of Aeronautics since 01 Jun 2026
Sector	Defence & aerospace — military aircraft, missiles and missile defence, helicopters and mission systems, space
Employees	~123,000 at 31 Dec 2025, including ~72,000 engineers, scientists and IT professionals; ~93% in the US (FY2025 10-K)
Market cap	~$127.4bn ($552.09 at 16 Oct 2026 close × 230.79m shares at 20 Jul 2026)
FY2025 Revenue	$75,048m net sales (+5.6%)
FY2025 net earnings	$5,017m (GAAP EPS $21.49, after a company-disclosed $7.03 per share of programme losses and other charges)
Backlog	Record $230.4bn at 28 Jun 2026, up from $193.6bn at 31 Dec 2025
2026 guidance	Net sales $79.75–81.75bn, diluted EPS $29.95–30.65, free cash flow $7.0–7.2bn (raised 23 Jul 2026; excludes the pending Ultra Maritime acquisition)
Dividend	$3.60 quarterly from the Q4 2026 payment (raised from $3.45 on 09 Oct 2026, the 24th consecutive annual increase), $14.40 annualised, ~2.6% yield at $552.09

2. Bull & Bear Case

Bull Case

• Record missile-led backlog: Backlog reached $230.4bn at 28 Jun 2026 after about $65bn of Q2 orders. Missiles and Fire Control backlog nearly doubled in six months to $87.9bn, helped by a THAAD contract worth up to $35bn.
• Interceptor capacity ramp: A Jan 2026 framework agreement aims to lift PAC-3 MSE output from about 600 to about 2,000 a year, after 620 were delivered in 2025. MFC sales rose 19% in Q2 2026 on PAC-3 and THAAD volume.
• Earnings recovery and raised guidance: Q2 2026 GAAP EPS was $7.94, against $1.46 a year earlier when $1.6bn of programme losses were booked. 2026 guidance now calls for EPS of $29.95–30.65, up from $21.49 in 2025.
• Shareholder returns: The dividend has been raised for 24 consecutive years, most recently to $3.60 a quarter. In 2025 Lockheed returned about $6.1bn ($3.1bn of dividends and $3.0bn of buybacks), and its repurchase authority stood at $9bn after Oct 2025.
• New franchises: Lockheed holds positions in Golden Dome space-based interceptor prototypes, the Next Generation Interceptor and the AIM-260 JATM missile, and a $1.2bn PrSM Increment 2 IDIQ was awarded on 21 Sep 2026.

Bear Case

• Recurring programme charges: In FY2025 programme losses and other charges cut EPS by $7.03 per share. They included $950m on a classified Aeronautics programme, and Q1 2026 brought further unfavourable adjustments on F-16, C-130, CH-53K and Seahawk.
• F-35 delivery slowdown: F-35 deliveries fell to 51 in H1 2026 from 97 in H1 2025, and the F-35 made up 27% of 2025 sales. GAO expected combat-capable TR-3 jets only in 2026, about three years late.
• Flat earnings history: Net sales grew at only ~2.9% a year between FY2021 and FY2025, and GAAP EPS fell from $22.76 to $21.49 over the same period.
• Thin equity, heavy obligations: Shareholders’ equity was just $8.8bn at 28 Jun 2026 against $20.5bn of long-term debt, and pension obligations remain large enough to cause settlement charges ($479m in Q4 2025).
• Share price drawdown: At $552.09 the shares are about 20% below their 52-week high of $692.00. Executives and a director sold shares in 2026, and no open-market purchases were found.

3. Business Segments

Lockheed reports four segments. Percentages use FY2025 net sales of $75,048m. From Jan 2026, Rotary and Mission Systems was reorganised into two lines of business, but it is still reported as one segment.

Segment	% of revenue	What it is
Aeronautics	40.3% ($30,257m)	Military aircraft (F-35, F-16, F-22, C-130) and Skunk Works advanced development; F-35 alone was 67% of segment sales.
Rotary and Mission Systems	23.1% ($17,312m)	Sikorsky helicopters (Black Hawk, Seahawk, CH-53K), Aegis combat system, radars, C2BMC, ships and training.
Missiles and Fire Control	19.3% ($14,450m)	Air and missile defence (PAC-3, THAAD), strike and tactical missiles (GMLRS, PrSM, JASSM, LRASM, JAGM, Javelin JV), sensors and hypersonics.
Space	17.4% ($13,029m)	Trident II D5 fleet ballistic missiles, Next Generation Interceptor, Next-Gen OPIR and GPS III satellites, Orion, and SDA Transport and Tracking Layers.

Segment backlog at 28 Jun 2026 was $87.9bn at MFC, $54.4bn at Aeronautics, $48.5bn at RMS and $39.7bn at Space.

4. Business Model & Moat

How it makes money. Most sales go to the US government, plus foreign military sales and direct sales to allies. Contracts are a mix of cost-reimbursable work, where profit is a fee on costs, and fixed-price production and development work, where Lockheed keeps the savings or absorbs overruns. Profit is booked over the life of each contract, so estimates are revised every quarter. Those revisions are the source of the “profit adjustments” and reach-forward losses that recur in the results.

Production and sustainment tail. Platforms such as the F-35, Black Hawk and Trident stay in production for decades and are then sustained for decades more, so each programme win produces a long stream of follow-on production, upgrade and support revenue.

Moat. The F-35 is a fifth-generation fighter flown by the US and a growing list of allies, including Germany, whose first F-35A rolled out on 18 Sep 2026. PAC-3 and THAAD are combat-proven interceptors. Qualification, security clearances and installed fleets make these positions very hard to displace. The trade-off is fixed-price risk and dependence on a single dominant customer.

5. Financial Health

Annual figures are from Lockheed’s Q4 earnings releases and SEC XBRL filings. Long-term debt is the non-current balance-sheet amount at year end.

Fiscal Year	Revenue ($m)	YoY %	GAAP EPS	Adjusted EPS	Dividend/share	Long-term debt (YE)
FY2021	$67,044m	+2.5%	$22.76	$22.76†	$10.60	$11,670m
FY2022	$65,984m	−1.6%	$21.66	$21.66†	$11.40	$15,429m
FY2023	$67,571m	+2.4%	$27.55	$27.55†	$12.15	$17,291m
FY2024	$71,043m	+5.1%	$22.31	$22.31†	$12.75	$19,627m
FY2025	$75,048m	+5.6%	$21.49	$21.49†	$13.35	$20,532m

† Lockheed Martin reports GAAP EPS only and publishes no adjusted EPS, so the GAAP figure is repeated. It does publish a table of programme losses and other charges, which put the FY2025 EPS impact at $7.03; adding that back would give about $28.52, a ChartsView calculation and not a company figure. FY2021 growth is measured against FY2020 net sales of $65,398m. Dividends are declared per share as reported in SEC XBRL.

Quarterly progression, most recent first, with the FY2025 total in bold:

Quarter / Half	Revenue	Adjusted EPS	GAAP EPS
Q2 2026	$20,063m	$7.94†	$7.94
Q1 2026	$18,021m	$6.44†	$6.44
Q4 2025	$20,321m	$5.80†	$5.80
Q3 2025	$18,609m	$6.95†	$6.95
Q2 2025	$18,155m	$1.46†	$1.46
Q1 2025	$17,963m	$7.28†	$7.28
FY2025 total	$75,048m	$21.49†	$21.49

Q2 2025 included $1.6bn of programme losses: $950m on a classified Aeronautics programme, $570m on the Canadian Maritime Helicopter Program and $95m on the Turkish Utility Helicopter Program. Q4 2025 included a $479m pension settlement charge. Over the four quarters to 28 Jun 2026, net sales were ~$77.0bn and GAAP EPS ~$27.13.

Cash flow and balance sheet. All figures are from SEC XBRL filings and Lockheed’s earnings releases (FY2025 10-K and Q2 2026 10-Q).

• Operating cash flow: $8.56bn in FY2025, after an $860m pension contribution in Q4; ~$10.40bn trailing twelve months to 28 Jun 2026. 2026 guidance is $9.2–9.4bn.
• Capital expenditure: $1.65bn in FY2025, giving free cash flow of $6.91bn; 2026 capex guidance is $2.0–2.4bn.
• Depreciation & amortisation: $1.69bn in FY2025; ~$1.69bn trailing twelve months.
• Debt at 28 Jun 2026: $20,538m of non-current long-term debt and no current portion, after $1,168m was current at year end.
• Cash at 28 Jun 2026: cash and equivalents $3,791m; no short-term marketable securities are reported. Shareholders’ equity was $8,768m.

6. Valuation

Raw metrics, October 2026. Not opinions on whether the stock is cheap or expensive.

Metric	Value
Market cap	~$127.4bn (price $552.09 at 16 Oct 2026 close × 230.79m shares)
Enterprise value	~$144.2bn (market cap ~$127.4bn + total debt ~$20.5bn − cash ~$3.8bn per 28 Jun 2026 balance sheet)
Trailing P/E (GAAP)	~20.3x ($552.09 / TTM GAAP EPS ~$27.13, Q3 2025–Q2 2026)
P/E (forward)	~18.2x ($552.09 / $30.30, the midpoint of 2026 EPS guidance of $29.95–30.65)
P/S (TTM)	~1.65x ($127.4bn / ~$77.0bn TTM net sales)
EV/EBITDA (TTM)	~13.3x (EV ~$144.2bn / TTM EBITDA ~$10.84bn; EBITDA = operating profit ~$9.15bn + D&A ~$1.69bn). On FY2025 EBITDA of ~$9.42bn ($7.73bn + $1.69bn), which was reduced by programme losses, it is ~15.3x
P/FCF	~18.4x (market cap ~$127.4bn / FY2025 FCF ~$6.91bn; FCF = operating CF $8.56bn − capex $1.65bn per FY2025 cash flow statement). On 2026 FCF guidance of $7.0–7.2bn it is ~17.9x
Dividend yield	~2.6% ($14.40 annualised / $552.09)
52-week high	$692.00
52-week low	$437.25
Short interest (% of float)	~1.4% (2.74m shares at the 30 Sep 2026 settlement, up from 2.69m on 31 Aug)
Days to cover	~2.3 days

7. What Are They Building

Lockheed is shifting investment towards munitions and missile-defence capacity and space-based defence, while working through the F-35 software and hardware upgrade.

• Missile-defence capacity: PAC-3 MSE production is targeted to rise towards ~2,000 a year under a seven-year framework agreed in Jan 2026, and GM Defense delivered its first PAC-3 MSE components on 17 Sep 2026. Lockheed unveiled PAC-3 Edge for the Army’s future interceptor on 09 Oct 2026, and a THAAD contract worth up to $35bn was awarded on 24 Jun 2026.
• F-35 TR-3 and Block 4: GAO expected combat-capable TR-3 deliveries in 2026, about three years late, with a reduced Block 4 completed around 2031. Deliveries slowed to 19 jets in Q2 2026.
• Strike weapons: The JASSM/LRASM large-lot contract rose to about $10.46bn after an $826m modification on 09 Sep 2026. A $1.2bn PrSM Increment 2 IDIQ followed on 21 Sep, and a framework agreement on 17 Sep 2026 aims to speed up AIM-260 JATM production.
• Space and homeland defence: The Next Generation Interceptor completed a Stage 2 motor static fire on 10 Aug 2026. Lockheed is one of 12 companies holding Golden Dome space-based interceptor prototype agreements (up to $3.2bn in total, Apr 2026), and Orion flew NASA’s crewed Artemis II mission in Q1 2026.
• Hypersonics and industrial base: The Army’s Dark Eagle hypersonic weapon completed an all-up-round flight test on 26 Mar 2026. Lockheed signed a solid-rocket-motor agreement with Avio (13 Oct 2026) and a munitions expansion with Hadrian (14 Oct 2026), and on 06 Jul 2026 it agreed to buy Ultra Maritime for $3.45bn.

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8. Competitive Landscape

Lockheed competes with RTX, Northrop Grumman, General Dynamics and Boeing for US and allied defence budgets. Several of them are also its partners or suppliers; RTX’s Pratt & Whitney, for example, makes the F-35’s F135 engine. Market caps are 16 Oct 2026 closes, and metrics come from each company’s FY2025 results release.

Peer	Market cap (Oct 2026)	Key 2025 metric
RTX Corporation (RTX)	~$261.4bn	FY2025 sales $88.6bn, per RTX FY2025 results release
Boeing (BA)	~$150.3bn	FY2025 revenue $89.5bn, per Boeing Q4 2025 release
General Dynamics (GD)	~$93.1bn	FY2025 revenue $52.6bn, per GD Q4 2025 release
Northrop Grumman (NOC)	~$73.9bn	FY2025 sales $42.0bn, per Northrop Q4 2025 release

9. Leadership & Insider Activity

Jim Taiclet is Chairman, President and Chief Executive Officer, and Evan Scott is CFO. On 06 May 2026 Lockheed said Aeronautics President Greg Ulmer would retire, and OJ Sanchez, previously head of Skunk Works, took over from 01 Jun 2026. No 2026 Form 4 transactions by the CEO were found. Form 4 filings show no open-market insider purchases in 2026. The filings report weighted price ranges in footnotes, so the values below are estimates.

Name	Date	Type	Shares	Price	Value	Plan Type
John Donovan (Director)	13 Aug 2026	Sale	3,378	~$597–602	~$2.0m	No 10b5-1 plan indicated on Form 4
Robert Lightfoot Jr. (President, Space)	11 Aug 2026	Sale (11–12 Aug)	2,606	~$600–602	~$1.57m	No 10b5-1 plan indicated on Form 4
Timothy Cahill (President, MFC)	11 Mar 2026	Sale	4,620	~$648–656	~$3.0m	No 10b5-1 plan indicated on Form 4
Gregory Ulmer (then President, Aeronautics)	27 Feb 2026	Sale	2,840	~$650–651	~$1.85m	No 10b5-1 plan indicated on Form 4
Stephanie Hill (President, RMS)	24 Feb 2026	Sale	2,410	~$665–666	~$1.6m	No 10b5-1 plan indicated on Form 4
Stephanie Hill (President, RMS)	22 Feb 2026	Shares withheld for tax on RSU/PSU vesting	2,166	$658.26	~$1.43m	Not applicable (tax withholding)

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10. Key Risks

• F-35 concentration (Operational): The F-35 made 27% of 2025 sales. Lockheed faces risks from order cuts or delays, TR-3 and Block 4 software delays, supplier performance, contract definitisation and sustainment cost, and the delivery slowdown in 2026 shows how quickly cash and earnings can be affected.
• Fixed-price programme losses (Financial): The classified Aeronautics programme is a fixed-price incentive contract with options. Lockheed has taken reach-forward losses on it, on CMHP and TUHP, and on a classified MFC programme ($1.41bn in 2024), and its 10-Q filings warn that further losses are possible.
• US budget process (Macro): Continuing resolutions, shutdowns and debt-ceiling disputes can delay new starts and production-rate increases. Multi-year awards such as THAAD and PAC-3 still depend on annual appropriations.
• Pension obligations (Financial): Changes in discount rates and returns affect funding needs and earnings, and transfers of obligations to insurers create settlement charges such as $479m in Q4 2025.
• Supply chain and inflation (Operational): Tariffs, rare-earth supply, solid rocket motors, inflation and workforce availability all constrain the planned ramp in missile output.
• Acquisition integration (Operational): The pending $3.45bn Ultra Maritime purchase needs regulatory approval, and once closed it has to be integrated into RMS.

11. Recent Developments

• 16 Oct 2026 — TACAMO aircraft delivered. Lockheed delivered a C-130J-30 to the US Navy as the future E-130J TACAMO aircraft.
• 14 Oct 2026 — Munitions expansion with Hadrian. Lockheed announced a munitions manufacturing expansion with Hadrian that it said would create 6,000 US jobs, 2,000 of them in Texas.
• 13 Oct 2026 — Avio rocket-motor agreement. Lockheed signed a strategic cooperation agreement with Avio for solid rocket motors.
• 09 Oct 2026 — Dividend raised to $3.60. The Q4 2026 dividend rose $0.15, the 24th consecutive annual increase, and is payable 31 Dec 2026. The same day, Lockheed unveiled the PAC-3 Edge interceptor.
• 01 Oct 2026 — Q3 date set. Lockheed will report Q3 2026 results on 22 Oct, before the market opens.
• 21 Sep 2026 — PrSM Increment 2 contract. The Army awarded an IDIQ worth up to $1.2bn after a second maritime test.
• 18 Sep 2026 — Germany’s first F-35A. Germany’s first F-35A rolled out at Fort Worth.
• 17 Sep 2026 — AIM-260 and PAC-3 supply. A framework agreement with the Department of War aims to accelerate AIM-260 JATM production, and GM Defense delivered its first PAC-3 MSE components.
• 09 Sep 2026 — JASSM/LRASM modification. An $826m modification took the large-lot contract to about $10.46bn.
• 23 Jul 2026 — Q2 2026 results and guidance raise. Net sales rose 11% to $20.1bn and GAAP EPS was $7.94, and backlog hit a record $230.4bn. EPS guidance rose to $29.95–30.65 and FCF guidance to $7.0–7.2bn, while F-35 deliveries fell to 19 from 50.
• 06 Jul 2026 — Ultra Maritime deal. Lockheed agreed to buy Ultra Maritime from Advent for $3.45bn, adding the business to RMS.

Budget and macro releases that move defence stocks are tracked on the Economic Calendar.

12. Key Dates

• 22 Oct 2026 — Q3 2026 results before the market opens, conference call 8:30am ET
• 01 Dec 2026 — record date (and listed ex-dividend date) for the $3.60 Q4 2026 dividend
• 31 Dec 2026 — Q4 2026 dividend payable
• Expected Jan 2027 — Q4 and full-year 2026 results with 2027 guidance (FY2025 results were released on 29 Jan 2026)
• TBC — completion of the $3.45bn Ultra Maritime acquisition, subject to regulatory approval

The FY2027 US defence appropriations timetable remains uncertain; a continuing resolution would limit new starts and production-rate increases.

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