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Lockheed Martin (LMT) Outpaces Stock Market Gains: What You Should Know

Zacks Equity Research
Goodyear (GT) reported earnings 30 days ago. What's next for the stock? We take a look at earnings estimates for some clues.

In the latest trading session, Lockheed Martin (LMT) closed at $305.66, marking a +1.02% move from the previous day. This change outpaced the S&P 500's 0.11% gain on the day. Elsewhere, the Dow lost 0.32%, while the tech-heavy Nasdaq added 0.19%.

Coming into today, shares of the aerospace and defense company had lost 0.14% in the past month. In that same time, the Aerospace sector lost 3.27%, while the S&P 500 gained 3.84%.

Investors will be hoping for strength from LMT as it approaches its next earnings release, which is expected to be April 23, 2019. The company is expected to report EPS of $4.30, up 6.97% from the prior-year quarter. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $12.65 billion, up 8.69% from the year-ago period.

LMT's full-year Zacks Consensus Estimates are calling for earnings of $19.46 per share and revenue of $56.82 billion. These results would represent year-over-year changes of +10.63% and +5.68%, respectively.

Any recent changes to analyst estimates for LMT should also be noted by investors. Recent revisions tend to reflect the latest near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Our research shows that these estimate changes are directly correlated with near-term stock prices. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate remained stagnant. LMT currently has a Zacks Rank of #3 (Hold).

Valuation is also important, so investors should note that LMT has a Forward P/E ratio of 15.55 right now. This valuation marks a premium compared to its industry's average Forward P/E of 14.6.

We can also see that LMT currently has a PEG ratio of 2.24. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. The Aerospace - Defense industry currently had an average PEG ratio of 1.5 as of yesterday's close.

The Aerospace - Defense industry is part of the Aerospace sector. This industry currently has a Zacks Industry Rank of 47, which puts it in the top 19% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

To follow LMT in the coming trading sessions, be sure to utilize Zacks.com.


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