Lockheed Martin upgraded at Vertical Research on missile growth

Lockheed Martin (LMT) stock rose 3.3% after Vertical Research initiated coverage with a buy rating and a $600 price target, citing secure missile funding. Bernstein cut its target to $564, citing budget uncertainty. LMT is down 23% from its highs.

Vertical Research Partners upgraded Lockheed Martin (LMT) to Buy with a $600 price target, citing attractive valuation metrics like a P/E ratio of 18.65 and PEG ratio of 0.35. The firm expects resilient defense franchises and realistic U.S. defense spending growth. Recent developments include a $24.3B F-35 sale to Saudi Arabia and an $871M contract modification for F-35 support equipment.

Lockheed Martin and Avio have partnered to boost U.S. rocket motor production for ER GMLRS and PrSM programs. Avio will invest over $500M in new U.S. production capacity, strengthening Lockheed's supply chain. The agreement aims to increase missile output and defense capabilities, though financial details and timelines were not disclosed.

Avio shares rose over 5% after announcing a deal with Lockheed Martin to expand solid rocket motor production in the U.S. The agreement focuses on the Extended Range GMLRS and Precision Strike Missile programs. Avio plans to invest over $500 million in new U.S. production capacity, with analysts noting the deal aligns with Avio's 2035 targets.

Canada paused a $1.3B deal for 16 UH-60M Black Hawk helicopters from Lockheed Martin's Sikorsky due to trade tensions with the U.S. The decision is part of a broader effort to reduce military reliance on the U.S. and evaluate options for special forces' needs. The government is also reviewing a planned purchase of 88 F-35 fighters, also made by Lockheed Martin.

Lockheed Martin (LMT) won an $117.1M U.S. Army contract for Apache helicopter radar support, extending through 2031. The company offers a 2.69% dividend yield, a 50% payout ratio, and a 5.4% 3-year dividend growth rate. LMT's GF Score is 86/100, with strong profitability and valuation metrics. The stock is trading at a discount to its GF Value of $567.85. Institutional interest is mixed, with some gurus adding positions and insiders selling shares.