Lockheed Martin's Stock Price Reflects Undue Pessimism Offering Margin Of Safety

Summary

• Lockheed Martin's stock price reflects undue pessimism; the current market price undervalues growth prospects, offering a margin of safety for investors.
• Recent stock declines are linked to tariff regimes, improbable defense spending cuts, and losing the NGAD contract to Boeing, but these do not fully capture Lockheed's potential.
• Lockheed's stable revenue from U.S. defense contracts and limited exposure to tariffs suggest resilience and potential for future growth.
• Valuation analysis shows Lockheed's stock is priced close to a "no-growth" scenario, making any future growth a bonus and supporting a buy recommendation.

Jozsef Soos

Introduction, Previous Coverage and Approach

We previously published an article on Lockheed Martin Corporation (LMT) in October 2021 when we observed that the share price reflected an unduly pessimistic view of their growth prospects. Our model

Analyst’s Disclosure:I/we have a beneficial long position in the shares of LMT either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.