#7 - Lockheed Martin Corporation (NYSE:LMT)
Lockheed Martin Corporation (NYSE: LMT) After the Presidential election of 2016, Lockheed Martin’s earnings went full steam ahead. The nation’s largest defense contractor was one of the major beneficiaries of the Trump administration’s renewed commitment to defense spending. However, the mid-term elections, while not bringing the “blue wave” many were suggesting, did bring a Democratic majority back to the U.S. House of Representatives. In general, when the Democrats control either or both houses of Congress, it’s a predictive indicator that defense spending is about to go down. If it does, then Lockheed Martin will have a difficult time achieving the 155.2% increase in profits they had forecasted for 2018. In fact, with the stock dropping 17% during the October correction, it seems that market analysts were already seeing the writing on the wall. Growth is projected to slow to 11.5% per year. The big question will come down to profits. Current estimates are for the company to post average annual profit growth of 51.8% over the next five years. If defense spending gets cut, however, this percentage could come down, or even turn into a profit reduction. From a technical standpoint, Lockheed Martin’s stock appears to be overvalued when compared to other stocks in its sector. LMT’s stock currently has a P/E ratio of just over 28 which indicates that even with robust earnings, the price of the stock continues to rise in a disproportionate fashion.
About Lockheed Martin
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. The company operates through Aeronautics, Missiles and Fire Control, Rotary and Mission Systems, and Space segments.
Read More - Current Price
- $489.02
- Consensus Rating
- Moderate Buy
- Ratings Breakdown
- 9 Buy Ratings, 4 Hold Ratings, 1 Sell Ratings.
- Consensus Price Target
- $612.29 (25.2% Upside)
