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Investing.com - Bernstein raised its price target on Lockheed Martin (NYSE:LMT) to $545.00 from $497.00 on Monday, while maintaining a Market Perform rating on the aerospace and defense contractor. According to InvestingPro data, the $115.6B market cap company currently trades at a P/E of 27.86x, with analyst targets ranging from $425 to $630.
The price target increase reflects Bernstein’s updated S&P market multiple from 15.1x to 16x, which raised the firm’s absolute multiple for Lockheed Martin to 14.2x from 13.4x.
Bernstein noted that Lockheed Martin has a strong top-line growth outlook based on substantial orders for F-35, CH-53K, PAC-3, and other programs ahead of the company’s third-quarter earnings report.
The defense contractor is scheduled to report its Q3 earnings on Tuesday, October 21, with a conference call set for 11 AM ET.
Despite the positive order outlook, Bernstein highlighted that Lockheed Martin has faced operational challenges in its Aeronautics, Missiles and Fire Control (MFC), and Rotary and Mission Systems (RMS) segments that have resulted in recent charges, making progress toward stabilizing performance on fixed-price development programs a key watch item for the upcoming earnings report. InvestingPro analysis reveals weak gross profit margins of 8.25%, though the company maintains strong dividend credentials with 23 consecutive years of increases. Get the full analysis and more exclusive insights with the comprehensive Pro Research Report, available on InvestingPro.
In other recent news, Lockheed Martin has secured over $1.4 billion in defense contracts, including a significant $647 million contract modification for Trident II missile production and support services. This contract also involves a Foreign Military Sale to the United Kingdom and is expected to be completed by September 2030. Denmark is nearing an order for 16 additional Lockheed Martin F-35 fighter jets, valued at up to 29 billion Danish kroner, to expand its fleet. Denmark has already received 21 of the 27 F-35s initially ordered in 2016. Belgium recently welcomed its first F-35A Lightning II fighter jet at Florennes Air Base, marking a milestone in its air force modernization. Meanwhile, Sikorsky, a Lockheed Martin company, has transformed a UH-60L Black Hawk helicopter into an autonomous U-Hawk utility aircraft, featuring increased cargo space and advanced autonomy technology. Denmark has also announced an $8.5 billion investment in defense, which includes purchasing 16 new F-35 jets and bolstering its Arctic presence.
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