Lockheed Martin Stock Fair Value Calculation – Lockheed Martin Offers Investors a Safe Haven with 10%+ Annual Return Potential
December 29, 2023
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Lockheed Martin ($NYSE:LMT) is an American aerospace and defense company that offers investors a safe haven to park their funds, with the potential of achieving over 10% annual returns. As a global leader in aerospace and defense, the company provides a wide competitive advantage that has enabled them to become one of the best-performing stocks in the market. Lockheed Martin has low exposure to disruption and economic shocks, and their strong balance sheet and cash flows make them a reliable option for investors who are looking for consistent returns with minimal risk. The company provides an impressive breadth of products and services, from satellites, missiles, and fighter jets, to homeland security solutions, cyber security services, and advanced aircraft training.
Lockheed Martin is also innovating in the areas of artificial intelligence, hypersonics, augmented reality, robotics, satellite technology, and more, helping to keep them on the cutting edge of technology. This makes them well-positioned for long-term growth potential, while also providing investors with a safe haven during periods of market volatility.
Analysis – Lockheed Martin Stock Fair Value Calculation
At GoodWhale, we have conducted an analysis of the fundamentals of LOCKHEED MARTIN to determine the fair value of its stock. Our proprietary Valuation Line calculation has resulted in a fair value of around $451.0 per share. Currently, the stock is trading at $451.2, which is a fair price. We believe investors could benefit from buying LOCKHEED MARTIN stock at its current price. More…
About the Company
Income Snapshot
Below shows the total revenue, net income and net margin for Lockheed Martin. More…
| Total Revenues | Net Income | Net Margin |
| 67.69k | 6.97k | 10.3% |
Cash Flow Snapshot
Below shows the cash from operations, investing and financing for Lockheed Martin. More…
| Operations | Investing | Financing |
| 7.48k | -1.8k | -4.56k |
Balance Sheet Snapshot
Below shows the total assets, liabilities and book value per share for Lockheed Martin. More…
| Total Assets | Total Liabilities | Book Value Per Share |
| 56.67k | 47.39k | 37.55 |
Key Ratios Snapshot
Some of the financial key ratios for Lockheed Martin are shown below. More…
| 3Y Rev Growth | 3Y Operating Profit Growth | Operating Margin |
| 1.8% | -0.2% | 13.3% |
| FCF Margin | ROE | ROA |
| 8.6% | 60.8% | 9.9% |
Peers
The U.S. Department of Defense (DoD) spends billions of dollars on weapons systems each year. Major weapons systems contractors compete for these funds. The competition among these companies is fierce. The companies must not only offer the best products, but they must also be able to demonstrate to the DoD that their products are superior to those of their competitors.
Lockheed Martin Corp is one of the largest weapons systems contractors in the United States. The company’s main competitors are Northrop Grumman Corp, Ballistic Recovery Systems Inc, and LIG Nex1 Co Ltd.
– Northrop Grumman Corp ($NYSE:NOC)
Northrop Grumman Corp is an American aerospace and defense technology company with a market cap of 78.41B as of 2022. The company has a Return on Equity of 34.54%. Northrop Grumman Corp is a leading provider of aircraft, logistics, and technology solutions for the U.S. military, government, and commercial customers. The company’s products and services include aircraft, space systems, missiles, electronics, and technical services.
– Ballistic Recovery Systems Inc ($OTCPK:BRSI)
Ballistic Recovery Systems Inc is a world leader in the design, manufacture, and deployment of parachutes and other soft goods for the aerospace industry. The company has a market cap of 4.19M as of 2022 and a ROE of -159.06%. Ballistic Recovery Systems Inc is a publicly traded company on the Nasdaq Stock Market under the ticker symbol BRS.
– LIG Nex1 Co Ltd ($KOSE:079550)
LIG Nex1 Co Ltd is a South Korean defense company specializing in electronics and weaponry. It was founded in 1999 and is headquartered in Seoul. The company has a market cap of 1.87T as of 2022 and a Return on Equity of 14.92%. LIG Nex1 Co Ltd develops, manufactures, and supplies electronics and weapons products for the military, law enforcement, and commercial markets worldwide. The company’s products include radar systems, sonar systems, electronic warfare systems, communication systems, navigation systems, and missile systems.
Summary
Lockheed Martin is a leading aerospace and defense company with a moat that provides strong protection against competition. Its strong market position has enabled it to generate solid returns for investors, with an average return of more than 10% per year. Moreover, the company’s products and services are essential to government operations, providing a source of income that is largely unaffected by economic or political turmoil.
Lockheed also has a well-defined capital structure which allows it to effectively manage debt and has generated strong free cash flow for shareholders. Overall, the company presents an excellent opportunity for investors looking to add a reliable and high-quality defense stock to their portfolios.
