Lockheed Martin Corp (LMT, Financial) has recently been in the spotlight, drawing interest from investors and financial analysts due to its robust financial stance. With shares currently priced at $481.93, Lockheed Martin Corp has witnessed a daily loss of 0.25%, marked against a three-month change of -19.39%. A thorough analysis, underlined by the GF Score, suggests that Lockheed Martin Corp is well-positioned for substantial growth in the near future.
Understanding the GF Score
The GF Score is a stock performance ranking system developed by GuruFocus using five aspects of valuation, which has been found to be closely correlated to the long-term performances of stocks by backtesting from 2006 to 2021. The stocks with a higher GF Score generally generate higher returns than those with a lower GF Score. Therefore, when picking stocks, investors should invest in companies with high GF Scores. The GF Score ranges from 0 to 100, with 100 as the highest rank.
- Financial strength rank: 6/10
- Profitability rank: 9/10
- Growth rank: 8/10
- GF Value rank: 9/10
- Momentum rank: 9/10
Each one of these components is ranked and the ranks also have positive correlation with the long term performances of stocks. The GF score is calculated using the five key aspects of analysis. Through backtesting, we know that each of these key aspects has a different impact on the stock price performance. Thus, they are weighted differently when calculating the total score. With a GF Score of 92 out of 100, Lockheed Martin Corp signals the highest outperformance potential.
Company Overview: Lockheed Martin Corp
Lockheed Martin Corp is the world's largest defense contractor and has dominated the Western market for high-end fighter aircraft since it won the F-35 Joint Strike Fighter program in 2001. Lockheed's largest segment is aeronautics, which derives upward of two-thirds of its revenue from the F-35. Lockheed's remaining segments are rotary and mission systems, mainly encompassing the Sikorsky helicopter business; missiles and fire control, which creates missiles and missile defense systems; and space systems, which produces satellites and receives equity income from the United Launch Alliance joint venture. The company boasts a market cap of $114.23 billion, with sales amounting to $71.29 billion and an operating margin of 12.12%.
Financial Strength Breakdown
According to the Financial Strength rating, Lockheed Martin Corp's robust balance sheet exhibits resilience against financial volatility, reflecting prudent management of capital structure. The Interest Coverage ratio for Lockheed Martin Corp stands impressively at 8.42, underscoring its strong capability to cover its interest obligations. This robust financial position resonates with the wisdom of legendary investor Benjamin Graham, who favored companies with an interest coverage ratio of at least 5. With a favorable Debt-to-Revenue ratio of 0.27, Lockheed Martin Corp's strategic handling of debt solidifies its financial health.
Profitability Rank Breakdown
The Profitability Rank shows Lockheed Martin Corp's impressive standing among its peers in generating profit. Lockheed Martin Corp's strong Predictability Rank of 5.0 stars out of five underscores its consistent operational performance, providing investors with increased confidence.
Growth Rank Breakdown
Ranked highly in Growth, Lockheed Martin Corp demonstrates a strong commitment to expanding its business. The company's 3-Year Revenue Growth Rate is 5%, which outperforms worse than 62.37% of 279 companies in the Aerospace & Defense industry. Moreover, Lockheed Martin Corp has seen a robust increase in its earnings before interest, taxes, depreciation, and amortization (EBITDA) over the past few years. Specifically, the three-year growth rate stands at 4.9, and the rate over the past five years is 6.6. This trend accentuates the company's continued capability to drive growth.
Conclusion: Lockheed Martin Corp's Path to Outperformance
Lockheed Martin Corp's financial strength, profitability, and growth metrics, as highlighted by the GF Score, underscore the firm's unparalleled position for potential outperformance. The company's strategic initiatives, robust financial health, and consistent growth trajectory make it a compelling choice for value investors seeking long-term gains. As the defense industry continues to evolve, Lockheed Martin Corp's innovative capabilities and market leadership position it well for future success. For those interested in exploring more companies with strong GF Scores, GuruFocus Premium members can utilize the following screener link: GF Score Screen.
This article, generated by GuruFocus, is designed to provide general insights and is not tailored financial advice. Our commentary is rooted in historical data and analyst projections, utilizing an impartial methodology, and is not intended to serve as specific investment guidance. It does not formulate a recommendation to purchase or divest any stock and does not consider individual investment objectives or financial circumstances. Our objective is to deliver long-term, fundamental data-driven analysis. Be aware that our analysis might not incorporate the most recent, price-sensitive company announcements or qualitative information. GuruFocus holds no position in the stocks mentioned herein.