LOCKHEED MARTIN CORP (LMT) Stock Fundamental Analysis
NYSE:LMT - New York Stock Exchange, Inc. - US5398301094 - Common Stock - Currency: USD
LMT gets a fundamental rating of 5 out of 10. The analysis compared the fundamentals against 67 industry peers in the Aerospace & Defense industry. While LMT is still in line with the averages on profitability rating, there are concerns on its financial health. LMT has a correct valuation and a medium growth rate.
1. Profitability
1.1 Basic Checks
In the past year LMT was profitable.
In the past year LMT had a positive cash flow from operations.
In the past 5 years LMT has always been profitable.
In the past 5 years LMT always reported a positive cash flow from operatings.
1.2 Ratios
With a decent Return On Assets value of 7.14%, LMT is doing good in the industry, outperforming 79.10% of the companies in the same industry.
Looking at the Return On Equity, with a value of 78.82%, LMT belongs to the top of the industry, outperforming 100.00% of the companies in the same industry.
Looking at the Return On Invested Capital, with a value of 14.80%, LMT belongs to the top of the industry, outperforming 97.01% of the companies in the same industry.
LMT had an Average Return On Invested Capital over the past 3 years of 18.86%. This is significantly above the industry average of 8.47%.
The 3 year average ROIC (18.86%) for LMT is well above the current ROIC(14.80%). The reason for the recent decline needs to be investigated.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.14% | ||
| ROE | 78.82% | ||
| ROIC | 14.8% |
ROA(3y)11.21%
ROA(5y)11.9%
ROE(3y)82.45%
ROE(5y)83.72%
ROIC(3y)18.86%
ROIC(5y)19.56%
1.3 Margins
LMT's Profit Margin of 5.85% is fine compared to the rest of the industry. LMT outperforms 62.69% of its industry peers.
In the last couple of years the Profit Margin of LMT has declined.
LMT has a Operating Margin (8.30%) which is in line with its industry peers.
In the last couple of years the Operating Margin of LMT has declined.
The Gross Margin of LMT (8.25%) is worse than 80.60% of its industry peers.
In the last couple of years the Gross Margin of LMT has declined.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 8.3% | ||
| PM (TTM) | 5.85% | ||
| GM | 8.25% |
OM growth 3Y-9.81%
OM growth 5Y-6.86%
PM growth 3Y-7.27%
PM growth 5Y-6.33%
GM growth 3Y-10.04%
GM growth 5Y-6.72%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), LMT is creating value.
LMT has less shares outstanding than it did 1 year ago.
LMT has less shares outstanding than it did 5 years ago.
Compared to 1 year ago, LMT has a worse debt to assets ratio.
2.2 Solvency
An Altman-Z score of 2.97 indicates that LMT is not a great score, but indicates only limited risk for bankruptcy at the moment.
LMT has a Altman-Z score of 2.97. This is comparable to the rest of the industry: LMT outperforms 46.27% of its industry peers.
The Debt to FCF ratio of LMT is 6.50, which is on the high side as it means it would take LMT, 6.50 years of fcf income to pay off all of its debts.
LMT's Debt to FCF ratio of 6.50 is fine compared to the rest of the industry. LMT outperforms 67.16% of its industry peers.
A Debt/Equity ratio of 3.47 is on the high side and indicates that LMT has dependencies on debt financing.
The Debt to Equity ratio of LMT (3.47) is worse than 85.07% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 3.47 | ||
| Debt/FCF | 6.5 | ||
| Altman-Z | 2.97 |
ROIC/WACC1.44
WACC10.29%
2.3 Liquidity
A Current Ratio of 0.98 indicates that LMT may have some problems paying its short term obligations.
LMT's Current ratio of 0.98 is on the low side compared to the rest of the industry. LMT is outperformed by 88.06% of its industry peers.
A Quick Ratio of 0.83 indicates that LMT may have some problems paying its short term obligations.
LMT has a Quick ratio of 0.83. This is in the lower half of the industry: LMT underperforms 74.63% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.98 | ||
| Quick Ratio | 0.83 |
3. Growth
3.1 Past
The Earnings Per Share has been growing slightly by 4.27% over the past year.
LMT shows a small growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 5.03% yearly.
LMT shows a small growth in Revenue. In the last year, the Revenue has grown by 1.09%.
The Revenue has been growing slightly by 3.50% on average over the past years.
EPS 1Y (TTM)4.27%
EPS 3Y5.96%
EPS 5Y5.03%
EPS Q2Q%6.42%
Revenue 1Y (TTM)1.09%
Revenue growth 3Y1.95%
Revenue growth 5Y3.5%
Sales Q2Q%0.18%
3.2 Future
The Earnings Per Share is expected to grow by 5.65% on average over the next years.
Based on estimates for the next years, LMT will show a small growth in Revenue. The Revenue will grow by 3.22% on average per year.
EPS Next Y-0.49%
EPS Next 2Y4.37%
EPS Next 3Y5.32%
EPS Next 5Y5.65%
Revenue Next Year4.4%
Revenue Next 2Y4.06%
Revenue Next 3Y4%
Revenue Next 5Y3.22%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
The Revenue growth rate is stable: in the next years the growth will be about the same than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 14.51 indicates a correct valuation of LMT.
Based on the Price/Earnings ratio, LMT is valued cheaply inside the industry as 97.01% of the companies are valued more expensively.
The average S&P500 Price/Earnings ratio is at 27.93. LMT is valued slightly cheaper when compared to this.
LMT is valuated correctly with a Price/Forward Earnings ratio of 13.96.
Compared to the rest of the industry, the Price/Forward Earnings ratio of LMT indicates a rather cheap valuation: LMT is cheaper than 97.01% of the companies listed in the same industry.
The average S&P500 Price/Forward Earnings ratio is at 37.78. LMT is valued rather cheaply when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 14.51 | ||
| Fwd PE | 13.96 |
4.2 Price Multiples
LMT's Enterprise Value to EBITDA ratio is rather cheap when compared to the industry. LMT is cheaper than 83.58% of the companies in the same industry.
LMT's Price/Free Cash Flow ratio is rather cheap when compared to the industry. LMT is cheaper than 86.57% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 29.65 | ||
| EV/EBITDA | 15.64 |
4.3 Compensation for Growth
The decent profitability rating of LMT may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)2.88
EPS Next 2Y4.37%
EPS Next 3Y5.32%
5. Dividend
5.1 Amount
LMT has a Yearly Dividend Yield of 3.13%. Purely for dividend investing, there may be better candidates out there.
Compared to an average industry Dividend Yield of 1.17, LMT pays a better dividend. On top of this LMT pays more dividend than 98.51% of the companies listed in the same industry.
LMT's Dividend Yield is a higher than the S&P500 average which is at 2.32.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.13% |
5.2 History
On average, the dividend of LMT grows each year by 7.21%, which is quite nice.
LMT has paid a dividend for at least 10 years, which is a reliable track record.
As LMT did not decrease their dividend in the past 5 years, we can say the dividend looks stable.
Dividend Growth(5Y)7.21%
Div Incr Years6
Div Non Decr Years6
5.3 Sustainability
73.60% of the earnings are spent on dividend by LMT. This is not a sustainable payout ratio.
The dividend of LMT is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP73.6%
EPS Next 2Y4.37%
EPS Next 3Y5.32%
421.34
+0.17 (+0.04%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryAerospace & Defense
Earnings (Last)
Earnings (Next)
Inst Owners75.05%
Inst Owner Change-1.02%
Ins Owners0.05%
Ins Owner Change12.01%
Market Cap98.72B
Analysts74.29
Price Target540.21 (28.21%)
Short Float %1.17%
Short Ratio1.85
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.13% |
Yearly Dividend12.91
Dividend Growth(5Y)7.21%
DP73.6%
Div Incr Years6
Div Non Decr Years6
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)12.9%
Min EPS beat(2)12.03%
Max EPS beat(2)13.78%
EPS beat(4)4
Avg EPS beat(4)10.9%
Min EPS beat(4)3.56%
Max EPS beat(4)14.24%
EPS beat(8)7
Avg EPS beat(8)8.07%
EPS beat(12)9
Avg EPS beat(12)6.11%
EPS beat(16)12
Avg EPS beat(16)3.52%
Revenue beat(2)0
Avg Revenue beat(2)-1.65%
Min Revenue beat(2)-3.21%
Max Revenue beat(2)-0.09%
Revenue beat(4)0
Avg Revenue beat(4)-2.05%
Min Revenue beat(4)-3.21%
Max Revenue beat(4)-0.09%
Revenue beat(8)3
Avg Revenue beat(8)0.9%
Revenue beat(12)5
Avg Revenue beat(12)1.02%
Revenue beat(16)5
Avg Revenue beat(16)-0.32%
PT rev (1m)-0.71%
PT rev (3m)0.45%
EPS NQ rev (1m)-2.83%
EPS NQ rev (3m)-5.29%
EPS NY rev (1m)-0.39%
EPS NY rev (3m)0.48%
Revenue NQ rev (1m)0.44%
Revenue NQ rev (3m)0.39%
Revenue NY rev (1m)0.01%
Revenue NY rev (3m)0.04%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 14.51 | ||
| Fwd PE | 13.96 | ||
| P/S | 1.37 | ||
| P/FCF | 29.65 | ||
| P/OCF | 19.47 | ||
| P/B | 18.51 | ||
| P/tB | N/A | ||
| EV/EBITDA | 15.64 |
EPS(TTM)29.04
EY6.89%
EPS(NY)30.18
Fwd EY7.16%
FCF(TTM)14.21
FCFY3.37%
OCF(TTM)21.64
OCFY5.14%
SpS306.63
BVpS22.77
TBVpS-34.09
PEG (NY)N/A
PEG (5Y)2.88
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.14% | ||
| ROE | 78.82% | ||
| ROCE | 17.28% | ||
| ROIC | 14.8% | ||
| ROICexc | 15.38% | ||
| ROICexgc | 25.67% | ||
| OM | 8.3% | ||
| PM (TTM) | 5.85% | ||
| GM | 8.25% | ||
| FCFM | 4.63% |
ROA(3y)11.21%
ROA(5y)11.9%
ROE(3y)82.45%
ROE(5y)83.72%
ROIC(3y)18.86%
ROIC(5y)19.56%
ROICexc(3y)20.04%
ROICexc(5y)21.1%
ROICexgc(3y)34.88%
ROICexgc(5y)36.6%
ROCE(3y)22.03%
ROCE(5y)22.85%
ROICexcg growth 3Y-7.66%
ROICexcg growth 5Y-4.12%
ROICexc growth 3Y-8.46%
ROICexc growth 5Y-4.57%
OM growth 3Y-9.81%
OM growth 5Y-6.86%
PM growth 3Y-7.27%
PM growth 5Y-6.33%
GM growth 3Y-10.04%
GM growth 5Y-6.72%
F-Score5
Asset Turnover1.22
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 3.47 | ||
| Debt/FCF | 6.5 | ||
| Debt/EBITDA | 2.43 | ||
| Cap/Depr | 105.9% | ||
| Cap/Sales | 2.42% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 66.63% | ||
| Profit Quality | 79.19% | ||
| Current Ratio | 0.98 | ||
| Quick Ratio | 0.83 | ||
| Altman-Z | 2.97 |
F-Score5
WACC10.29%
ROIC/WACC1.44
Cap/Depr(3y)115.09%
Cap/Depr(5y)118.75%
Cap/Sales(3y)2.47%
Cap/Sales(5y)2.48%
Profit Quality(3y)98.69%
Profit Quality(5y)102.38%
High Growth Momentum
Growth
EPS 1Y (TTM)4.27%
EPS 3Y5.96%
EPS 5Y5.03%
EPS Q2Q%6.42%
EPS Next Y-0.49%
EPS Next 2Y4.37%
EPS Next 3Y5.32%
EPS Next 5Y5.65%
Revenue 1Y (TTM)1.09%
Revenue growth 3Y1.95%
Revenue growth 5Y3.5%
Sales Q2Q%0.18%
Revenue Next Year4.4%
Revenue Next 2Y4.06%
Revenue Next 3Y4%
Revenue Next 5Y3.22%
EBIT growth 1Y-31.04%
EBIT growth 3Y-8.05%
EBIT growth 5Y-3.6%
EBIT Next Year25.67%
EBIT Next 3Y10.68%
EBIT Next 5Y7.62%
FCF growth 1Y-44.55%
FCF growth 3Y-11.77%
FCF growth 5Y-1.93%
OCF growth 1Y-34.36%
OCF growth 3Y-8.9%
OCF growth 5Y-0.95%