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What this page is: Delvantic's full research page for Lockheed Martin Corporation (LMT) — AI-driven forensic equity research: mechanical valuation models (DCF, EPV, anchored-PE, scenario) plus three independent AI lenses (Quality / Value / Sentiment). Everything below is rendered server-side; you are not missing content that requires JavaScript. All scores are predictions and research opinions, not financial advice.
Our current read (analysis of 2026-08-23): Designation Low · Gem Score -26 (−100…+100 Quality+Value blend) · Quality 23 · Value -66 · Sentiment 56 (timing only, not weighted) · Composite fair value $493.25 vs $577.60 at analysis
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Lockheed Martin Corporation
LMT NYSELockheed Martin Corporation is a global aerospace and defense company that designs, develops, and manufactures advanced technology systems for government and commercial customers worldwide. The company operates across multiple business segments, providing cutting-edge solutions including aircraft, missiles, radar systems, space technologies, and integrated defense platforms. Lockheed Martin serves the U.S. Department of Defense, international allied governments, and commercial aviation sectors. Its product portfolio encompasses fighter jets, tactical missiles, rotorcraft, electronic warfare systems, and space launch vehicles. The company also provides cybersecurity, intelligence, and information technology solutions to enhance national security and operational capabilities. With headquarters in Bethesda, Maryland, Lockheed Martin plays a critical role in maintaining advanced defense capabilities and technological innovation across the global aerospace and defense industry.
Price Overview
Price History (1 Year)
Revenue & Net Income Trend
| Period | Revenue | Net Income | Net Margin | YoY/QoQ |
|---|
Key Metrics
EPS (Diluted): 21.49
Total Equity: $6.72B
Shares: 233,500,000
Total Debt: $21.70B
Cash: $4.12B
EBITDA: $9.42B
Total Debt: $21.70B
Cash: $4.12B
Revenue: $75.05B
Revenue: $75.05B
Revenue: $75.05B
Total Equity: $6.72B
Tax Rate: 15.3%
Equity: $6.72B
Total Debt: $21.70B
Cash: $4.12B
Current Liabilities: $23.34B
Long-Term Debt: $20.53B
Total Debt: $21.70B
Total Equity: $6.72B
Shares: 233,500,000
Shares: 233,500,000
CapEx: -$1.65B
Shares: 233,500,000
Stock Price: $589.33
Net Income: $5.02B
Industry Benchmarks
Income Statement (Annual)
Last updated: Jul 30, 2026 10:58am (24d ago)| Metric | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|
| Revenue | $67.0B | $66.0B | $67.6B | $71.0B | $75.0B |
| Cost of Revenue | $58.0B | $57.7B | $59.1B | $64.1B | $67.4B |
| Gross Profit | $9.1B | $8.3B | $8.5B | $6.9B | $7.6B |
| Operating Expenses | -$62.0M | -$61.0M | -$28.0M | -$83.0M | -$112.0M |
| Operating Income | $9.1B | $8.3B | $8.5B | $7.0B | $7.7B |
| Net Income | $6.3B | $5.7B | $6.9B | $5.3B | $5.0B |
| EBITDA | $10.2B | $9.5B | $9.9B | $8.6B | $9.4B |
| EPS | $22.85 | $21.74 | $27.65 | $22.39 | $21.56 |
| EPS (Diluted) | $22.76 | $21.66 | $27.55 | $22.31 | $21.49 |
Balance Sheet (Annual)
Last updated: Aug 5, 2026 9:35am (18d ago)| Metric | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|
| Cash & Equivalents | $3.6B | $2.5B | $1.4B | $2.5B | $4.1B |
| Total Current Assets | $19.8B | $21.0B | $20.5B | $21.8B | $25.4B |
| Total Assets | $50.9B | $52.9B | $52.5B | $55.6B | $59.8B |
| Current Liabilities | $14.0B | $15.9B | $16.9B | $19.4B | $23.3B |
| Long-Term Debt | $11.7B | $15.4B | $17.3B | $19.6B | $20.5B |
| Total Liabilities | $39.9B | $43.6B | $45.6B | $49.3B | $53.1B |
| Total Equity | $11.0B | $9.3B | $6.8B | $6.3B | $6.7B |
| Retained Earnings | $21.6B | $16.9B | $15.4B | $14.6B | $14.0B |
Cash Flow (Annual)
Last updated: Jul 30, 2026 10:58am (24d ago)| Metric | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|
| Operating Cash Flow | $9.2B | $7.8B | $7.9B | $7.0B | $8.6B |
| Capital Expenditure | -$1.5B | -$1.7B | -$1.7B | -$1.7B | -$1.6B |
| Free Cash Flow | $7.7B | $6.1B | $6.2B | $5.3B | $6.9B |
| Acquisitions (net) | $0 | — | — | — | — |
| Net Debt Issued / (Repaid) | -$500.0M | $4.0B | $1.9B | $2.8B | $1.3B |
| Dividends Paid | -$2.9B | -$3.0B | -$3.1B | -$3.1B | -$3.1B |
| Stock Buybacks | -$4.1B | -$7.9B | -$6.0B | -$3.7B | -$3.0B |
| Net Change in Cash | $444.0M | -$1.1B | -$1.1B | $1.0B | $1.6B |
Growth Trends (YoY %)
Last updated: Jul 30, 2026 10:58am (24d ago)| Metric | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|
| Revenue Growth | -1.6% | +2.4% | +5.1% | +5.6% |
| Gross Profit Growth | -8.5% | +2.3% | -18.3% | +9.9% |
| Operating Income Growth | -8.5% | +1.9% | -17.6% | +10.2% |
| Net Income Growth | -9.2% | +20.7% | -22.9% | -6.0% |
| EBITDA Growth | -6.8% | +4.6% | -13.7% | +9.9% |
Dividend History (Last 20)
Last updated: Aug 5, 2026 9:35am (18d ago)| Date | Dividend | Declaration | Record | Payment |
|---|---|---|---|---|
| 2026-06-01 | $3.45 | — | — | — |
| 2026-03-02 | $3.45 | — | — | — |
| 2025-12-01 | $3.45 | — | — | — |
| 2025-09-02 | $3.30 | — | — | — |
| 2025-06-02 | $3.30 | — | — | — |
| 2025-03-03 | $3.30 | — | — | — |
| 2024-12-02 | $3.30 | — | — | — |
| 2024-09-03 | $3.15 | — | — | — |
| 2024-06-03 | $3.15 | — | — | — |
| 2024-02-29 | $3.15 | — | — | — |
| 2023-11-30 | $3.15 | — | — | — |
| 2023-08-31 | $3.00 | — | — | — |
| 2023-05-31 | $3.00 | — | — | — |
| 2023-02-28 | $3.00 | — | — | — |
| 2022-11-30 | $3.00 | — | — | — |
| 2022-08-31 | $2.80 | — | — | — |
| 2022-05-31 | $2.80 | — | — | — |
| 2022-02-28 | $2.80 | — | — | — |
| 2021-11-30 | $2.80 | — | — | — |
| 2021-08-31 | $2.60 | — | — | — |
Deep Analysis
Risk : Reward — if the last quarter repeats
Live · as of 2026-08-19 09:04Even the bull case prices 12% below today — the ratio here measures the model-vs-market gap, not payoff odds. Another quarter like the worst recent one costs 50%.
| Case | Growth | Margin | Fair value | vs price ($577.60) |
|---|---|---|---|---|
| Bull — recovery | +10% | 9.4% | $507.02 | -12% |
| Base — stabilizes | +6% | 8.2% | $401.73 | -30% |
| Bear — keeps slipping | +3% | 6.9% | $312.18 | -46% |
| Stress — last quarter repeats | +0% | 7.1% | $288.31 | -50% |
Narrative Economics
market-narrative step).
Claude Reading
Starting from the raw prints: LMT is running $75B revenue TTM with 5.4% top-line CAGR, but earnings have gone the wrong way — 2021 NI of $6.32B down to $5.02B in 2025, a -14.9% earnings CAGR while revenue grew. That's not a mature compounder, that's margin erosion. Gross margin at 10.15% and operating margin at 10.3% are anemic for a defense prime — Northrop and GD run materially higher operating margins. The quarterly pattern shows why the market is nervous: Q2'25 net income cratered to $342M (1.9% margin) and Q4'24 to $527M (2.8%), reflecting classified program charges that management insists are non-recurring but keep recurring. The two most recent quarters (Q1'26 $1.49B, Q2'26 $1.84B) look like recovery, but 8-9% net margins are still below the 9-10% historical baseline. Free cash flow of $6.91B on a $136B market cap is a ~5% FCF yield — not cheap, not expensive.
The balance sheet deserves scrutiny the models glossed over. $21.7B debt against $6.72B equity gives 3.2x D/E, and the ROE of 74.6% is a mathematical artifact of the shrunken equity base from aggressive buybacks — not evidence of superior returns. ROIC of 26.95% is the honest number, and it's genuinely good. But P/B of 20.4x on that thin equity is meaningless. The $4.12B cash against $21.7B debt with a current ratio of 1.09 is tighter than one wants for a company facing fixed-price contract inflation exposure and multi-year F-35 development commitments. This is a capital structure engineered for buyback optics, not resilience.
The synthesis says fair value $524, current $589 — a 12% premium. I think the models are slightly too generous. The bull case rests on "geopolitical premium is durable" and "F-35 sustainment inflection," both of which are consensus and already in the tape. What's underweighted: (1) fixed-price development contracts (F-35 Block 4, CH-53K, classified programs) continue to eat charges — the Q2'25 blowup was the fourth such surprise in three years, so calling it non-recurring requires faith the model shouldn't extend; (2) the DoD is under real fiscal pressure post-2025 continuing resolution dynamics, and a Trump administration's "efficiency" push (DOGE, Hegseth's audit posture) could pressure margins on legacy programs even as topline holds; (3) at 27x P/E on depressed earnings, the multiple is doing double duty — investors are paying up for both the narrative AND the assumed earnings recovery. If margins normalize to 9%, EPS runs ~$28-30 and a 18-20x historical multiple gets you $520-600, i.e., roughly here. If margins stay stuck at 7%, the stock is worth $400s. The asymmetry isn't attractive.
Where I dissent from the synthesis: "fair value" understates how much execution risk is baked in at current price. The Market Forces layer's "poor execution / multi-year recovery required" is directionally right and inconsistent with the synthesis's benign framing. The Thesis Evaluation score of -7 (mild bearish) is closer to my read than the synthesis's neutral. A contrarian bull would argue: F-35 sustainment is genuinely a multi-decade annuity, allied FMS demand (Germany, Japan, Poland) has 5+ year visibility, and once the fixed-price legacy contracts roll off around 2027, margins snap back to 11%+ and the stock re-rates on normalized earnings toward $700. That's a real case, but it requires patience through more charge-taking quarters and assumes no budget reset. I'd want to own this at $500 or below where the margin-recovery optionality is free; at $589 you're paying for it. Partial agreement with the "fair value" verdict but I lean overvalued given the earnings quality and balance sheet leverage the composite doesn't fully penalize.
GPT Reading
At $589, Lockheed Martin looks expensive for what the actual numbers are doing. The business is still high quality in the sense that revenue keeps grinding upward—$67.6B in 2023, $71.0B in 2024, $75.1B in 2025, with the last two quarters at $18.0B and $20.1B implying roughly 5-6% top-line growth. But the earnings line is not following. Net income fell from $6.92B in 2023 to $5.34B in 2024 and $5.02B in 2025, and the quarterly pattern is ugly: margins have swung from normal 9%+ levels to 2.8% in 4Q24 and 1.9% in 2Q25 before only partially recovering to 6.6%, 8.3%, and 9.2% in the last three quarters. That tells me this is not a clean “defense upcycle equals easy EPS growth” story; it is a large fixed-price, execution-sensitive contractor growing sales while struggling to hold profitability. Paying 27.4x earnings and 16.4x EV/EBITDA for that profile is rich.
The key contradiction is that the market is valuing Lockheed like a stable compounder while the income statement looks more like a mature industrial working through cost and program volatility. Revenue growth of 5.4% CAGR and FCF growth of 5.3% CAGR are fine, but earnings CAGR of negative 14.9% is the number that should drive the multiple debate. The 2025 annual net margin was just 6.7% on $75.05B of revenue, versus 10.2% in 2023. Even if I normalize away the worst quarters, the recent run rate is not screaming for a premium multiple: the last four quarters sum to about $6.29B of net income, still below the level that would make a $136B market cap obviously cheap. Free cash flow of $6.91B is solid, but that is only about a 5.1% FCF yield at the current market cap—not enough cushion when the company carries $21.7B of debt against just $4.1B of cash and only $6.7B of equity. The reported 74.7% ROE is basically meaningless as a quality signal when the equity base is so thin; the balance sheet is financially engineered, not fortress-like in any classic sense.
What stands out most is that the market appears to be capitalizing the geopolitical narrative more aggressively than the operating data justify. Yes, defense budgets are supportive and incumbency matters, but this is still a company with gross margin just 10.1% and operating margin 10.3% in 2025, both below its own better years. A 1.83x sales multiple may not look insane in isolation, but for a contractor with low-double-digit operating margins and lumpy program charges, it embeds confidence that execution issues are transient and that elevated defense demand converts efficiently into earnings. I do not see enough proof of that conversion yet. If anything, the raw data say the opposite: higher revenue has recently coincided with lower annual profit. For me, fair value is closer to the low-$500s, and I would need a much more visible earnings recovery before accepting a price near $590.
The best argument against this bearish read is straightforward: Lockheed’s bad quarters may be exactly the kind of temporary noise that long-duration defense franchises always throw off, while the backlog-like nature of the business and cash generation matter more than headline EPS volatility. Operating cash flow of $8.56B and FCF of $6.91B remain strong, the dividend yield is 2.3% with a 62% payout ratio that is still manageable, and the latest two quarters did show margin recovery from 1.9% and 2.8% troughs back to 8.3% and 9.2%. If those weak periods were program-specific charges rather than structural deterioration, then today’s P/E is overstating the true normalized earnings multiple. A bull can also argue that in a world of persistent NATO rearmament and U.S.-China competition, a business growing revenue mid-single-digits with sticky government customers deserves to trade above historical 15-18x earnings ranges. I weigh that argument less heavily because the burden of proof should be on margin restoration, and so far the annual record shows two straight years of earnings compression despite favorable demand.
What would change my mind is simple and measurable: I would want to see at least two to three consecutive quarters with revenue above $19B and net margins sustainably back in the 9-10% range, which would put annualized earnings power closer to $7B rather than $5-6B. I would also want evidence that free cash flow can move above $8B without balance-sheet strain, and that 2026 can finish with clear year-over-year net income growth rather than another sales-up/earnings-flat outcome. If that happens, I can support a premium multiple. If instead revenue keeps rising while margins wobble in the high-single digits and cash flow stays around $7B, then the stock is too expensive above roughly $550 and especially so near $590.
Grok Reading
The numbers tell a straightforward story of a franchise that is growing the top line while steadily destroying earnings power. Lockheed Martin pushed revenue from $67.6B in 2023 to $75.1B in 2025—a respectable 5.4% CAGR that tracks the elevated defense budget environment—yet net income collapsed from $6.92B to $5.02B over the same stretch. Operating income fell from $8.51B to $7.73B even as sales rose nearly $7.5B; gross margin compressed to 10.2% from the mid-teens levels of 2021–22. The quarterly tape is uglier still: two of the last eight quarters printed 1.9% and 2.8% net margins, the signature of fixed-price program charges and inflation bleed that management has not yet demonstrated it can reverse. Free cash flow of $6.91B remains the cleanest number on the sheet and supports the $3.1B-plus dividend, but FCF yield at the current $136B enterprise is only ~5.1% against mid-single-digit growth. At 27.4× trailing earnings and 16.4× EV/EBITDA, the market is paying a growth-stock multiple for a business whose earnings CAGR is negative 15% and whose ROE of 75% is an artifact of a $6.7B equity base after years of aggressive buybacks, not superior capital returns.
The balance sheet reinforces the mature-earner classification but does not justify the premium. Net debt of roughly $17.6B against thin equity produces a 3.2× debt-to-equity ratio and a current ratio of 1.09—adequate for a government contractor with multi-year backlog, yet leaving little cushion if working-capital or pension assumptions reverse. The valuation synthesis composite of $465–$525 already embeds the geopolitical tailwind and still sits 11–21% below the $589 print; the 10% narrative premium the market is awarding for “structural” defense spend is modest in absolute terms but material when earnings are shrinking. Momentum confirms the lag: recent revenue growth of 5.6% is fine, recent earnings growth of –6% is not. This is not a compounding machine at these prices; it is a high-quality cash cow being valued as if margin recovery and perpetual budget expansion are both assured.
The strongest contrary case rests on three facts. First, FCF has held up far better than GAAP earnings—$6.91B in 2025 with only $1.65B of capex—suggesting the margin hits are more accounting and timing than cash destruction, and that F-35 sustainment and classified work could re-accelerate earnings once the fixed-price hangover clears. Second, the geopolitical regime (China, Russia, NATO rearmament) has bipartisan durability that historical 15–18× P/E ranges never contemplated; if budgets structurally settle 100–200 bps higher as a share of GDP, the 27× multiple becomes less anomalous. Third, the moat is real—incumbency on F-35, Aegis, hypersonics, and classified platforms is multi-decade—and ROIC of 27% shows the core franchise still earns well above its cost of capital when not absorbing charges. A bull can therefore argue that 2024–25 were trough margin years, that the $525 “fair value” underweights the new baseline, and that any multiple compression will be limited. I weigh these points seriously but ultimately discount them: the market has already capitalized the better budget outlook, the charges have recurred across multiple years rather than appearing as one-offs, and paying 27× for 5% growth and negative earnings momentum leaves no margin of safety if either the budget or the margin narrative disappoints.
What flips the verdict is concrete evidence that margins are structurally healing and that the multiple can be earned. Specifically, two consecutive quarters of operating margin back above 11% with no program charges, full-year 2026 net income re-accelerating above $6.5B, or a clear multi-year DoD budget path that locks in mid-single-digit growth without political haircuts would force a re-rating toward fair value or better. Conversely, another sub-5% margin quarter or any signal of F-35/lot pricing pressure would confirm the overvaluation.
Big-3 Panel — where each AI stands
Advanced Analysis Forensic deep-dive · separate lenses
Lockheed is a classic mature_earner: revenue grew from $67.0B (2021) to $75.1B (2025), FCF held at $6.9B in 2025, and diluted shares shrank from 277.4M to 233.5M (a -4.2% CAGR) with buybacks running 1883% of SBC (0.4% of revenue). Earnings quality is clean - OCF/NI 1.4x, accruals -4.1% of assets, Beneish M -2.23, Altman Z 3.59 in the safe zone. This is a business whose reported numbers appear real and whose per-share economics are being concentrated, not diluted.
Verify before trusting this (5)
- Source of gross margin compression - specific program losses (Aeronautics classified, Sikorsky, missile programs) disclosed in 10-K
- Customer concentration and DoD program exposure by segment
- Pension accounting effects on reported margins vs cash margins
- Debt maturity schedule and coverage ratios given -$17.6B net debt
- Backlog trend and book-to-bill ratio for forward revenue visibility
Price is $577.60 against an e2e composite FV of $465.89 (-19%) and a signal-adjusted FV of $524.62 (-9%). The DCF at $563.58 is the only method that gets near today's price, and it does so by extrapolating current cash generation forward; the EPV floor ($367.90) and anchored PE ($368.49) both point roughly 35-40% lower, framing what the business earns today rather than what bulls hope it earns tomorrow. Averaging honestly, deserved value sits in the low-to-mid $500s, so buyers here are paying a ~10% premium to fair and a much larger premium to the earnings-power floor. Quality is Solid, not Fortress - operating margins have compressed ~330bps over four years and net income is below 2021 on higher revenue, which argues against paying a premium multiple. What has to go right to justify $577: sustained defense-budget tailwind AND margin recovery on F-35/classified programs AND continued buyback support. That is the consensus steady-compounder narrative, and it is already in the price. Earnings quality is high, so no haircut, but that just means the deserved value isn't lower - it doesn't make the stock cheap.
Verify before trusting this (4)
- F-35 program margin trajectory and any classified-program charges in next 10-Q
- Segment-level operating margin bridge - is compression bottoming?
- FY guidance for free cash flow and buyback pace
- Any DoD budget/CR risk language in transcript that would compress the multiple
The active story on LMT is a steady-compounder defense narrative anchored in great-power competition, NATO rearmament, and a record backlog - moderate intensity but highly durable, which is exactly the kind of pressure that keeps a name bid on quiet days. Recent news flow reinforces it: a $59B contract framing, orbital defense partnership with Gravitics, scandium supply MOU, an AI-intercept demo out of Skunk Works, and headlines explicitly asking 'is the stock still cheap' after a 15.5% three-month run. That is tailwind-flavored coverage, not skepticism. With beta 0.11, the mildly risk-on tape barely matters here - LMT does not need the market's help and would not be hurt much if it turned. What could tilt this to Balanced is the quiet drag from higher rates on a bond-proxy-like defensive with 3.23 D/E and ULA out doing a $500M private bond placement, plus a bear thread that valuation is priced for perpetual defense inflation. But no fading of the narrative is visible in the tape - if anything, each week brings another contract headline that refreshes it.
Verify before trusting this (4)
- Any signal of a US or NATO defense budget reset or de-escalation headline that would crack the durability of the story
- F-35 or major program execution stumbles that could puncture the record-backlog framing
- Analyst target revisions after the $59B contract - are they chasing higher or flagging valuation
- Sector rotation out of defensives if the risk-on tape broadens to high-beta cyclicals
This lens hasn't been run for this ticker yet.
When we made this prediction on Aug 6, 2026, LMT was $577.60. We expect it to be $568.00 by Feb 2027, and we consider it great value under $470.00. This is an early model (v0.6.0) — the direction is more reliable than the exact price. Made Aug 6, 2026.
Blue is our prediction, starting the day we made it. Grey is a slower route to the same place — the same destination, taking longer. Black is the actual price, so you can see how we are doing.