Lockheed Martin (LMT) Stock Forecast & Price Target

Lockheed Martin reported a revenue increase of $3.433 billion in its Missiles and Fire Control (MFC) segment, marking a 10.6% year-over-year growth driven by strong performance in programs like JASSM and LRASM, which positions the company favorably for continued demand in missile systems. The Aeronautics segment also demonstrated resilience with a 1.9% year-over-year revenue growth of $7.42 billion, attributed mainly to heightened F-35 aircraft production, reinforcing Lockheed Martin's dominant position in the defense sector. Furthermore, the outlook for MFC suggests a projected revenue growth rate of approximately 12% through 2025, supported by increasing funding for missile and missile defense systems within both the U.S. and international markets.

Lockheed Martin has revised its fiscal year 2026 free cash flow guidance downward to approximately $6 billion, indicating a year-over-year decline from previous projections of low single-digit to mid-single-digit growth. The company's second quarter of fiscal year 2025 showcased disappointing results, with substantial program losses totaling around $1.6 billion, leading to significant misses in revenue, segment operating income, and earnings per share, which were down by 2%, 71%, and 78%, respectively. Additionally, declining operating margins across critical segments, particularly the Aeronautics and Rotary & Mission Systems divisions, raise concerns about the company's profitability and execution capabilities, further contributing to a negative outlook on Lockheed Martin's stock.