Why Lockheed Martin Stock Is Falling Today

Source The Motley Fool

Key Points

  • One-time charges led to a significant profit miss.

  • Lockheed Martin still has a solid business, but there are few immediate catalysts.

  • 10 stocks we like better than Lockheed Martin ›

Lockheed Martin's (NYSE: LMT) quarter was loaded with cost overruns and write-offs, causing the defense contractor to miss expectations.

Investors were disappointed, sending Lockheed shares down more than 5% as of 10:30 ET Tuesday.

Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now. Continue »

A Lockheed Martin F-22 flying over a lake.

Image source: Lockheed Martin.

Charges eat into results

Lockheed Martin ranks as the world's largest defense contractor, but the company has come on hard times of late. The maker of the F-35 and a wide range of helicopters, missiles, and space systems has been shut out of recent high-profile awards, including the new fighter jet program that went to Boeing. Lockheed shares are down about 14% from their peak for the year.

The company's latest results are not helping reverse the momentum. Lockheed earned $1.46 per share in the quarter on revenue of $18.2 billion, missing Wall Street's consensus estimate for $6.52 per share in earnings on revenue of $18.6 billion.

There is a lot of noise in that earnings number. Quarterly results included $1.6 billion in program losses including $950 million on a classified aerospace project. Absent those charges, earnings would have come in at $7.29 per share.

Free cash flow was also soft. Lockheed used $150 million in cash, compared to an estimate for $1.2 billion in positive free cash flow, thanks to slower-than-expected F-35 deliveries.

Is Lockheed Martin stock a buy?

The charges were mostly one-time items, but unfortunately for investors there is no reason to believe things will improve anytime soon. Lockheed's book-to-bill, a measure of future business compared to current-quarter revenue, was an anemic 0.8x, with none of the company's four segments booking more business in the quarter than what they billed out.

Lockheed Martin remains a powerful franchise that should find new opportunities over time. But for now, investors are likely to have to be content with a 3% dividend yield as Lockheed works through these headwinds.

Should you invest $1,000 in Lockheed Martin right now?

Before you buy stock in Lockheed Martin, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Lockheed Martin wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $665,092!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,050,477!*

Now, it’s worth noting Stock Advisor’s total average return is 1,055% — a market-crushing outperformance compared to 180% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

See the 10 stocks »

*Stock Advisor returns as of July 21, 2025

Lou Whiteman has positions in Lockheed Martin. The Motley Fool recommends Lockheed Martin. The Motley Fool has a disclosure policy.

Disclaimer: For information purposes only. Past performance is not indicative of future results.
placeholder
Bitcoin Price Forecast: BTC slips below $110,000, wiping out over-leverage traders Bitcoin (BTC) hovers around $110,100 at the time of writing on Tuesday after closing below a key support level the previous day, triggering massive liquidations across the market.
Author  FXStreet
9 hours ago
Bitcoin (BTC) hovers around $110,100 at the time of writing on Tuesday after closing below a key support level the previous day, triggering massive liquidations across the market.
placeholder
Gold eases from $3,385 highs as Fed’s Cook refuses to resignGold‘s rally from Monday’s lows at $3,350 has been capped on Tuesday after hitting fresh two-week highs at $3,385.
Author  FXStreet
9 hours ago
Gold‘s rally from Monday’s lows at $3,350 has been capped on Tuesday after hitting fresh two-week highs at $3,385.
placeholder
Intel Warning: Government Stake Could Be a Double-Edged Sword, Threatening Global Sales and Subsidy ChainsU.S. chip giant Intel (INTC.US) stating that its $8.9 billion equity deal with the federal government could pose multiple risks to its business.
Author  TradingKey
10 hours ago
U.S. chip giant Intel (INTC.US) stating that its $8.9 billion equity deal with the federal government could pose multiple risks to its business.
placeholder
Whales move from Bitcoin to Ethereum with $2.5B stakedWhales are rotating from old BTC holdings into ETH, signaling ongoing expectations of a market recovery and more relevance for Ethereum.
Author  Cryptopolitan
10 hours ago
Whales are rotating from old BTC holdings into ETH, signaling ongoing expectations of a market recovery and more relevance for Ethereum.
placeholder
Bitcoin Struggles at $110,000 as Traders Pull Back Across MarketsBitcoin is trading 10% below its all-time high, pressured by heavy profit-taking that has wiped out some of its value since August 14.
Author  Beincrypto
10 hours ago
Bitcoin is trading 10% below its all-time high, pressured by heavy profit-taking that has wiped out some of its value since August 14.
goTop
quote