Lockheed Martin is set to report its Q2 2024 results, with expectations that revenue and earnings will align with street expectations. The company is expected to benefit from a strong demand environment amid ongoing geopolitical tensions. However, despite the positive outlook for Q2, forecast indicates that LMT stock has little room for growth.
LMT stock has shown gains over the past three years, but the increase has been inconsistent. While it has outperformed the S&P 500 in some years, it has underperformed in others. With the uncertain macroeconomic environment, including high oil prices and elevated interest rates, there is concern that LMT may face similar underperformance in the future. From a valuation perspective, LMT stock is estimated to have limited upside potential, with a forecasted valuation of $500 per share.
In the previous quarter, Lockheed Martin saw solid revenue growth across its segments, with the Missiles and Fire Control segment leading the way with a 25% increase in sales. However, its consolidated operating margin declined, leading to a decrease in EPS compared to the prior-year quarter. In the latest quarter, the company is expected to see growth across its segments, driven by increased production of F-16 and F-35 jets, as well as a multi-billion dollar contract to develop next-generation interceptors.
Despite the positive outlook for Lockheed Martin in the upcoming quarter, there are concerns about the stock’s growth potential. As per a valuation perspective, LMT stock is estimated to have limited upside potential, with a forecasted valuation of $500 per share. This indicates a 5% upside from its current levels. The company’s 2024 revenue is expected to be between $68.5 and $70.0 billion, with earnings projected to be between $25.65 and $26.35.
Although LMT stock may have limited room for growth, it is important to consider how it compares to its peers in the industry. Investors can explore valuable comparisons for companies across various industries to make informed investment decisions. Overall, the outlook for Lockheed Martin remains positive, but with some limitations on potential growth in the near term.
