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LMT Stock Analysis: Hold (Score 60.8/100) | Blank Capital Research | Blank Capital Research
LMT
LOCKHEED MARTIN CORP
$616.00
-7.87 (-1.26%)
Score60.8
Data as of Apr 6, 2026
LMT
LOCKHEED MARTIN CORP
IndustrialsDefense
$616.00
-7.87 (-1.26%)
Open $619.28High $621.70Low $607.16Prev $623.87Vol ---52W: $410.11 – $686.47
Hold
Composite score
01234567890123456789.0123456789
Global rank
#203
Percentile
Top 5%
Business quality
79th
percentile
Exceptional capital efficiency and structural profitability. This enterprise generates superior returns on invested capital compared to industry peers.
Relative valuation derived from Industrials sector median benchmarks. Model weights: EV/EBITDA (40%), P/B (35%), P/S (25%). Multiples adjusted for extreme outliers and non-recurring volatility.
Auditing capital efficiency...
Quality Profile Audit
Score: 78.7GRADE B+
Composite assessment of profitability, capital efficiency, and financial strength. Top-tier entities demonstrate sustainable cash flow generation.
Return on Equity
Profit generated per dollar of shareholder equity
79.2%
Sector: 8.9%
Dividend Analysis audit
INCOME
2.71%
Trailing Yield
$2.71
Per $100 Invested
Solid dividend yield for income-focused strategies.
Est. Payout Ratio
78%MID
Analyst Projections
Analyst Consensus
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Based on our 6-factor quantitative model, LOCKHEED MARTIN CORP (LMT) receives a "Hold" rating with a composite score of 60.8/100, ranked #203 out of 4446 stocks. Key factor scores: Quality 79/100, Value 41/100, Momentum 64/100. This is quantitative analysis only — not investment advice.
LOCKHEED MARTIN CORP (LMT) Stock Analysis — April 2026 Rating, Price, and Forecast
Company Overview — What Does LOCKHEED MARTIN CORP Do?
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. LOCKHEED MARTIN CORP (LMT) is classified as a large-cap stock in the Industrials sector, specifically within the Defense industry. The company is led by CEO James D. Taiclet and employs approximately 116,000 people, headquartered in Bethesda, Maryland. With a market capitalization of $142.3B, LMT is one of the prominent companies in the Industrials sector.
LOCKHEED MARTIN CORP (LMT) Stock Rating — Hold (April 2026)
As of April 2026, LOCKHEED MARTIN CORP receives a Hold rating with a composite score of 60.8/100 and 3 out of 5 stars from the Blank Capital Research quantitative model.LMT ranks #203 out of 4,446 stocks in our coverage universe. Within the Industrials sector, LOCKHEED MARTIN CORP ranks #37 of 752 stocks, placing it in the top 10% of its Industrials peers. The rating is generated by a multi-factor model that weighs quality (30%), momentum (25%), value (15%), investment (10%), stability (10%), and short interest (10%).
LMT Stock Price and 52-Week Range
LOCKHEED MARTIN CORP (LMT) currently trades at $616.00. The stock lost $7.87 (1.3%) in the most recent trading session. The 52-week high for LMT is $686.47, which means the stock is currently trading -10.3% from its annual peak. The 52-week low is $410.11, putting the stock 50.2% above its annual trough. Recent trading volume was 874K shares, suggesting relatively thin trading activity.
Is LMT Overvalued or Undervalued? — Valuation Analysis
LOCKHEED MARTIN CORP (LMT) carries a value factor score of 41/100 in the Blank Capital model, indicating fair valuation relative to historical norms. The trailing price-to-earnings ratio is 28.87x, compared to the Industrials sector average of 28.33x — a premium of 2%. The price-to-book ratio stands at 22.87x, versus the sector average of 2.23x. The price-to-sales ratio is 1.93x, compared to 0.50x for the average Industrials stock. On an enterprise value basis, LMT trades at 19.68x EV/EBITDA, versus 5.70x for the sector. The EV/EBIT multiple is 20.88x.
Overall, LMT's valuation appears roughly in line with sector benchmarks, suggesting the market is pricing the stock fairly given its current fundamentals and growth trajectory. Neither deep value nor significantly overpriced, the stock occupies a middle ground on valuation.
LOCKHEED MARTIN CORP Profitability — ROE, Margins, and Quality Score
LOCKHEED MARTIN CORP (LMT) earns a quality factor score of 79/100, reflecting elite profitability and capital efficiency that places it among the highest-quality businesses in the market. The return on equity (ROE) is 79.2%, compared to the Industrials sector average of 8.9%, which demonstrates strong shareholder value creation. Return on assets (ROA) comes in at 9.0% versus the sector average of 3.3%.
On a margin basis, LOCKHEED MARTIN CORP reports gross margins of 10.1%, compared to 35.8% for the sector. The operating margin is 10.3% (sector: 6.2%). Net profit margin stands at 6.7%, versus 3.9% for the average Industrials stock. Revenue growth is running at 18.8% on a trailing basis, compared to 6.4% for the sector. These metrics collectively paint a picture of a highly profitable business with durable competitive advantages.
LMT Debt, Balance Sheet, and Financial Health
LOCKHEED MARTIN CORP has a debt-to-equity ratio of 320.0%, compared to the Industrials sector average of 70.0%. This elevated leverage warrants close monitoring, as it increases the company's sensitivity to rising interest rates and economic downturns. Total debt on the balance sheet is $20.27B. Cash and equivalents stand at $2.48B.
LMT has a beta of 0.21, meaning it is less volatile than the S&P 500, making it a relatively defensive holding. The stability factor score for LOCKHEED MARTIN CORP is 88/100, indicating low-volatility characteristics and consistent price behavior that appeals to risk-averse investors.
LOCKHEED MARTIN CORP Revenue and Earnings History — Quarterly Trend
In TTM 2026, LOCKHEED MARTIN CORP reported revenue of $75.05B and earnings per share (EPS) of $22.39. Net income for the quarter was $5.02B. Gross margin was 10.1%. Operating income came in at $5.40B.
In FY 2024, LOCKHEED MARTIN CORP reported revenue of N/A and earnings per share (EPS) of $22.39. Operating income came in at $7.01B.
In Q4 2025, LOCKHEED MARTIN CORP reported revenue of $20.32B. Net income for the quarter was $1.34B. Gross margin was 11.4%.
In FY 2025, LOCKHEED MARTIN CORP reported revenue of $75.05B and earnings per share (EPS) of $21.56. Net income for the quarter was $5.02B. Gross margin was 10.2%. Operating income came in at $7.73B.
Over the past 8 quarters, LOCKHEED MARTIN CORP has demonstrated a growth trajectory, with revenue expanding from $36.12B to $75.05B. Investors analyzing LMT stock should weigh these quarterly trends alongside the valuation and quality metrics discussed above.
LMT Dividend Yield and Income Analysis
LOCKHEED MARTIN CORP (LMT) currently pays a dividend yield of 2.7%. At this yield, a $10,000 investment in LMT stock would generate approximately $$271.00 in annual dividend income. The net margin of 6.7% provides reasonable coverage for the dividend, though investors should monitor payout sustainability.
LMT Momentum and Technical Analysis Profile
LOCKHEED MARTIN CORP (LMT) has a momentum factor score of 64/100, reflecting neutral trend characteristics. The stock is neither significantly outperforming nor underperforming the broader market on a momentum basis. The investment factor score is 26/100, which measures capital allocation efficiency and asset growth patterns. The short interest score of 38/100 signals elevated short interest, which can indicate bearish sentiment among institutional investors.
LMT vs Competitors — Industrials Sector Ranking and Peer Comparison
Comparing LMT against the S&P 500 benchmark is also instructive for understanding relative performance. Investors can view the full LMT vs S&P 500 (SPY) comparison to assess how LOCKHEED MARTIN CORP stacks up against the broader market across all factor dimensions.
LMT Next Earnings Date
LOCKHEED MARTIN CORP (LMT) is scheduled to report earnings on April 23, 2026 for Q1 2026. Analysts estimate EPS of $6.73. Revenue is estimated at $18.32B.Investors can track all upcoming reports on the earnings calendar.
Should You Buy LMT? — Investment Thesis Summary
LOCKHEED MARTIN CORP presents a balanced picture with arguments on both sides. The quality score of 79/100 indicates above-average profitability and business fundamentals. Price momentum is positive at 64/100, suggesting the trend favors buyers. Low volatility (stability score 88/100) reduces downside risk.
In summary, LOCKHEED MARTIN CORP (LMT) earns a Hold rating with a composite score of 60.8/100 as of April 2026. The rating is derived from the Blank Capital Research methodology, which combines six factor dimensions into a single quantitative ranking. Investors should consider these quantitative signals alongside their own fundamental research, risk tolerance, and investment time horizon before making buy or sell decisions on LMT stock.
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Institutional Research Dossier
LOCKHEED MARTIN CORP (LMT) Deep Dive Analysis
Published on March 24, 2026
Action RatingHold
Sections
Executive Summary
We maintain a Buy rating on Lockheed Martin (LMT), driven by its dominant position in the defense industry, underpinned by long-term government contracts and a substantial backlog. While valuation appears stretched relative to the broader industrials sector, LMT's consistent profitability, high returns on equity, and essential role in national security justify a premium. The primary takeaway is that LMT's stability and consistent cash generation, coupled with its technological leadership, provide a compelling investment case despite potential headwinds from geopolitical shifts and evolving defense spending priorities.
LMT's strength lies in its entrenched relationships with the U.S. government and its allies, creating a significant barrier to entry for competitors. The company's diverse portfolio of defense systems, spanning aeronautics, missiles, rotary and mission systems, and space, mitigates risk and ensures a steady stream of revenue. Although the Investment score is relatively low, the company's focus on shareholder returns through dividends and share repurchases further supports our positive outlook.
Business Strategy & Overview
Lockheed Martin operates as a leading global security and aerospace company, deriving the majority of its revenue from contracts with the U.S. government, including foreign military sales facilitated through the U.S. government. The company's business is structured around four key segments: Aeronautics, Missiles and Fire Control, Rotary and Mission Systems, and Space. Each segment focuses on specific areas of defense and technology, allowing LMT to offer a comprehensive suite of products and services to its customers. The Aeronautics segment, known for its combat and air mobility aircraft, including the F-35 fighter jet, contributes significantly to overall revenue.
The Missiles and Fire Control segment provides critical defense systems, including air and missile defense, tactical missiles, and precision strike weapon systems. This segment is crucial for maintaining national security and responding to evolving global threats. Rotary and Mission Systems offers military and commercial helicopters, surface ships, and radar systems, playing a vital role in both military and civilian applications. The Space segment focuses on satellites, space transportation systems, and strategic missile systems, supporting national security and intelligence gathering efforts. LMT's strategic positioning is reinforced by its long-term contracts, often spanning multiple years, which provide revenue visibility and stability.
LMT's product pipeline is continuously evolving to meet the changing needs of its customers. The company invests heavily in research and development to maintain its technological edge and develop innovative solutions. This includes advancements in areas such as hypersonic weapons, artificial intelligence, and cybersecurity. The company's focus on innovation is essential for maintaining its competitive advantage and securing future contracts. The industry context is characterized by increasing geopolitical tensions and a growing demand for advanced defense technologies. LMT is well-positioned to capitalize on these trends, given its established relationships and technological capabilities.
The company's strategy also includes a focus on operational efficiency and cost reduction. LMT is constantly seeking ways to improve its manufacturing processes and supply chain management to enhance profitability. This includes initiatives such as lean manufacturing and digital transformation. Furthermore, LMT is committed to returning value to shareholders through dividends and share repurchases. The company has a consistent track record of increasing its dividend payout over time, demonstrating its commitment to shareholder returns. The low Investment score in the BCR proprietary quant model suggests that capital allocation and growth initiatives may be areas for improvement, but the company's overall strategic positioning remains strong.
Execution Benchmarks audit
Revenue Growth
YOY expansion rate
18.8%
Sector: 6.4%
+195% VS SCTR
Economic Moat Analysis
Lockheed Martin possesses a wide economic moat, primarily derived from intangible assets and switching costs. The company's intangible assets include its proprietary technology, patents, and expertise in developing and manufacturing complex defense systems. These assets are difficult for competitors to replicate, creating a significant barrier to entry. LMT's reputation for quality and reliability, built over decades of serving the U.S. government and its allies, further strengthens its intangible assets.
Switching costs are also a significant source of LMT's moat. The company's products and services are deeply integrated into the defense infrastructure of its customers. Replacing LMT's systems would be costly and time-consuming, making customers reluctant to switch to alternative providers. This is particularly true for major programs such as the F-35 fighter jet, which involves significant investments in training, maintenance, and support infrastructure. The long-term nature of defense contracts also contributes to switching costs, as customers are often locked into multi-year agreements.
The network effect, while not as pronounced as in other industries, also plays a role in LMT's moat. The company's extensive network of suppliers, subcontractors, and partners enhances its ability to deliver complex projects on time and within budget. This network effect creates a competitive advantage, as it is difficult for new entrants to build a similar ecosystem. Furthermore, LMT's relationships with government agencies and regulatory bodies provide valuable insights and access to information, further strengthening its position.
While LMT does not possess a cost advantage in the traditional sense, its scale and efficiency allow it to compete effectively on price. The company's large-scale manufacturing operations and supply chain management capabilities enable it to achieve economies of scale, reducing its unit costs. This is particularly important in the defense industry, where cost is a major consideration for government procurement decisions. The combination of intangible assets, switching costs, and network effects creates a formidable economic moat for Lockheed Martin, protecting its market share and profitability.
Financial Health & Profitability
Lockheed Martin exhibits a mixed financial profile. The company's revenue growth has been strong, with a TTM revenue of $75.05 billion and a revenue growth rate of 18.8% compared to the sector average of 6.6%. This indicates LMT's ability to capture market share and capitalize on increased defense spending. However, the gross margin of 10.1% is significantly lower than the sector average of 35.8%, suggesting potential inefficiencies in cost management or a different business model compared to its peers. The operating margin of 10.3% and net margin of 6.7% are higher than the sector averages of 6.2% and 3.7%, respectively, indicating effective operational management despite the lower gross margin.
LMT's profitability metrics are impressive. The company's ROE of 79.2% is substantially higher than the sector average of 9.2%, demonstrating its ability to generate significant returns on equity. This high ROE is a testament to LMT's efficient use of capital and its strong competitive position. The company's balance sheet, however, reveals a high level of leverage. The debt-to-equity ratio of 320.00 is significantly higher than the sector average of 70.00, indicating a reliance on debt financing. This high leverage could pose a risk if interest rates rise or if the company experiences a decline in revenue.
Cash flow generation is a key strength for LMT. The company's free cash flow (FCF) is $6.37 billion, providing ample resources for dividends, share repurchases, and debt repayment. The company's ability to generate consistent FCF is a positive sign for its long-term financial health. Examining the quarterly financial history reveals some variability in revenue and profitability. For example, Q2 2025 saw a lower gross margin of 4.0% and operating margin of 4.1% compared to Q1 2025, which had a gross margin of 12.9% and operating margin of 13.2%. This variability could be due to factors such as project mix, contract timing, and cost fluctuations.
Overall, Lockheed Martin's financial health is characterized by strong revenue growth, high profitability, and robust cash flow generation. However, the company's high leverage and lower gross margin compared to the sector are areas of concern. Investors should monitor these factors closely to assess the company's long-term financial stability. The Stability score of 89/100 in the BCR proprietary quant model reflects the company's low volatility and drawdown risk, which is consistent with its stable revenue stream and government contracts.
Valuation Assessment
Lockheed Martin's valuation presents a mixed picture. The company's P/E ratio of 28.0x is slightly higher than the sector average of 27.7x, suggesting that the stock is fairly valued relative to its earnings. However, the EV/EBITDA ratio of 19.6x is significantly higher than the sector average of 5.7x, indicating that the stock may be overvalued based on its enterprise value and earnings before interest, taxes, depreciation, and amortization. This discrepancy could be due to LMT's higher debt levels or the market's perception of its growth prospects.
The company's free cash flow yield, calculated as FCF divided by market capitalization, is approximately 4.4%, which is a reasonable yield given the current interest rate environment. However, it is important to consider the sustainability of LMT's FCF, as it can be affected by factors such as changes in defense spending and contract timing. Comparing LMT's valuation to its historical averages reveals that the stock is currently trading at a premium to its historical P/E ratio. This could be due to increased investor confidence in the company's long-term prospects or a general increase in market valuations.
Considering LMT's strong revenue growth, high ROE, and robust cash flow generation, a premium valuation may be justified. The company's dominant position in the defense industry and its long-term government contracts provide a degree of stability that is not typically found in other sectors. However, investors should be mindful of the potential risks associated with LMT's high leverage and the cyclical nature of defense spending. A discounted cash flow (DCF) analysis would be necessary to determine a more precise intrinsic value for the stock. Such an analysis would require assumptions about LMT's future revenue growth, profit margins, and discount rate.
Overall, Lockheed Martin's valuation appears to be fair to slightly expensive based on its current multiples. While the company's strong fundamentals and competitive advantages support a premium valuation, investors should exercise caution and consider the potential risks before investing. The Value score of 41/100 in the BCR proprietary quant model suggests that the stock is not particularly cheap, but its other strengths may outweigh this valuation concern. The Momentum score of 66/100 indicates that the stock has been performing well recently, which could be a positive sign for future returns.
Risk & Uncertainty
Lockheed Martin faces several specific risks that could impact its business and financial performance. One of the most significant risks is its dependence on government contracts, particularly with the U.S. government. Changes in defense spending priorities, budget cuts, or political shifts could lead to a reduction in contract awards, negatively affecting LMT's revenue and profitability. The company's reliance on a small number of large contracts also creates concentration risk, as the loss or delay of a major contract could have a material impact on its financial results.
Another risk is the potential for cost overruns and schedule delays on major projects. Developing and manufacturing complex defense systems is inherently challenging, and unforeseen technical issues, supply chain disruptions, or regulatory changes could lead to increased costs and delays. These issues could result in penalties, reduced profit margins, or even contract cancellations. The company's high leverage also poses a risk, as it increases its vulnerability to economic downturns and interest rate fluctuations. A significant decline in revenue or an increase in interest rates could make it difficult for LMT to service its debt, potentially leading to financial distress.
Competition from other defense contractors, such as Boeing, Northrop Grumman, and Raytheon Technologies, is another ongoing risk. These companies compete with LMT for government contracts and are constantly developing new technologies and solutions. Increased competition could lead to lower profit margins or a loss of market share. Furthermore, LMT faces regulatory risks related to environmental compliance, export controls, and cybersecurity. Changes in these regulations could increase the company's compliance costs or restrict its ability to operate in certain markets. The Short Interest score of 28/100 suggests that there is some skepticism among investors about the company's prospects, which could be related to these risks.
Bulls Say / Bears Say
The Bull Case
BULL VIEWLockheed Martin's entrenched position as the leading defense contractor, coupled with consistent government spending, ensures a stable and predictable revenue stream.
BULL VIEWThe F-35 program's long lifecycle and global adoption provide a multi-decade revenue backlog, making LMT a reliable investment for long-term growth and shareholder returns.
BULL VIEWLMT's commitment to innovation and technological advancement positions it to capture emerging opportunities in areas such as hypersonic weapons and space exploration, driving future growth.
The Bear Case
BEAR VIEWLockheed Martin's heavy reliance on government contracts makes it vulnerable to political shifts and budget cuts, potentially leading to significant revenue declines.
BEAR VIEWThe high debt-to-equity ratio exposes LMT to financial risk if interest rates rise or if the company experiences unexpected cost overruns on major projects.
BEAR VIEWThe relatively low gross margin compared to peers indicates potential inefficiencies and limits LMT's ability to generate substantial profit growth despite strong revenue.
About the Author
Marques Blank
Founder & Chief Investment Officer, Blank Capital
Marques brings 15 years of institutional finance and investing experience, having overseen financial planning for a $1.6B defense business unit. He developed the proprietary 6-factor quantitative model used to score LMT and 4,400+ other equities.
LOCKHEED MARTIN CORP exhibits a 365% valuation premium relative to institutional benchmarks. This represents a potential valuation overextension based on current multiples.
Return on Assets
Efficiency of asset utilization
9.0%
Sector: 3.3%
Gross Margin
Pricing power and cost efficiency
10.1%
Sector: 35.8%
Operating Margin
Core business profitability
10.3%
Sector: 6.2%
Net Margin
Bottom-line profitability
6.7%
Sector: 3.9%
Factor Methodology
The Quality factor evaluates the persistence and magnitude of cash flows. Companies with scores >70 exhibit superior competitive moats and financial resilience through economic cycles.
Sector Avg Yield0.00%
Yield Delta—
Income Projection audit
A $10,000 investment would generate approximately $271 annually in dividends at the current trailing rate.
