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Category: Stock Market and Lockheed Martin
Date: 31 January 2020 Stock Price: $435.90 We take a look at the 4th quarter earnings report of their 2019 fiscal year of Lockheed Martin, a global security and aerospace company that employs almost 105 000 people worldwide.
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About Lockheed Martin
Headquartered in Bethesda, Maryland, Lockheed Martin Corporation is a global security and aerospace company that employs approximately 105,000 people worldwide and is principally engaged in the research, design, development, manufacture, integration and sustainment of advanced technology systems, products and services.
Lockheed weapon systems
Lockheed Martin has a long history of successfully providing its customers with missile and missile systems that are affordable, proven, and in production. Our reputation is backed by a record of exceptional contractual performance and successful partnerships, in both the U.S. and international defense communities.
Lockheed Martin is supporting the warfighter by providing a wide variety of highly effective and reliable weapons systems to ensure that the right weapon is available for each situation that they may face. These weapon systems include precision strike weapons with long standoff ranges to keep pilots and aircraft out of harm's way. Lockheed Martin systems also include smart submunitions to give the warfighter maximum flexibility as well as fire support mobile artillery and guided munitions to dominate the battlefield.
Other Lockheed Martin systems include air-to-air missiles to give pilots air supremacy; helicopter launched anti-armor missiles to destroy enemy tanks and other armored vehicles; man-portable short-range anti-armor and assault weapons; kinetic energy hyper-velocity missiles that can defeat all current and future armored threats, hit-to-kill air defense systems that protect the troops from ballistic missiles, cruise missiles, enemy aircraft and weapons of mass destruction. Lockheed Martin-developed strategic missile systems include intercontinental-range ballistic missiles and reentry systems that serve as strategic deterrents.
Lockheed weapon systems
Lockheed Martin has a long history of successfully providing its customers with missile and missile systems that are affordable, proven, and in production. Our reputation is backed by a record of exceptional contractual performance and successful partnerships, in both the U.S. and international defense communities.
Lockheed Martin is supporting the warfighter by providing a wide variety of highly effective and reliable weapons systems to ensure that the right weapon is available for each situation that they may face. These weapon systems include precision strike weapons with long standoff ranges to keep pilots and aircraft out of harm's way. Lockheed Martin systems also include smart submunitions to give the warfighter maximum flexibility as well as fire support mobile artillery and guided munitions to dominate the battlefield.
Other Lockheed Martin systems include air-to-air missiles to give pilots air supremacy; helicopter launched anti-armor missiles to destroy enemy tanks and other armored vehicles; man-portable short-range anti-armor and assault weapons; kinetic energy hyper-velocity missiles that can defeat all current and future armored threats, hit-to-kill air defense systems that protect the troops from ballistic missiles, cruise missiles, enemy aircraft and weapons of mass destruction. Lockheed Martin-developed strategic missile systems include intercontinental-range ballistic missiles and reentry systems that serve as strategic deterrents.
Overview of Lockheed Martin's 4th quarter 2019 earnings report
Data below refers to quarterly data unless specified otherwise:
- Net sales: $15.878 billion (up from $14.411 billion for the same period of the previous year)
- Net sales increased by 10.2% over the last 12 months
- Cost of sales: $13.755 billion (up from $12.469 billion for the same period of the previous year)
- Cost of sales increased by 10.3% over the last 12 months
- Net earning: $1.498 billion (up from $1.253 billion for the same period of the previous year)
- Diluted earnings per share: $5.29 (up from $4.39 for the same period of the previous year)
- PE ratio of Lockheed Martin: 19.81
- Diluted weighted-average shares outstanding: 283.30 million (down from 285.5 million for the same period of the previous year)
- Cash and cash equivalents: $1.514 billion
- Cash and cash equivalents per share: $5.34
- Cash and cash equivalents makes up 1.23% of Lockheed Martin's market capital
- Cash and cash equivalents makes up 3.18% of Lockheed Martin's total assets
- Inventories of Lockheed Martin: $3.619 billion
- Inventories makes up 7.6% of Lockheed Martin's total assets
- Inventories makes up 7.6% of Lockheed Martin's total assets
- Lockheed Martin's Receivables, net: $2.337 billion
- Receivables makes up 4.92% of Lockheed Martin's total assets
- Receivables makes up 4.92% of Lockheed Martin's total assets
- Stockholders equity of Lockheed Martin: $3.171 billion
- Stockholders equity per share: $11.19
- So Lockheed Martin is trading at 38.9 times its stockholders equity which is well outside the expected range of between 2 and 4 that most firms then to trade at.
- Cash generated from operations for full fiscal year: $7.311 billion
- Cash generated from operations per share for full fiscal year: $25.86
Lockheed Martin's management commentary on their 4th quarter 2019 earnings
BETHESDA, Md., Jan. 28, 2020 /PRNewswire/ -- Lockheed Martin Corporation (NYSE: LMT) today reported fourth quarter 2019 net sales of $15.9 billion, compared to $14.4 billion in the fourth quarter of 2018. Net earnings in the fourth quarter of 2019 was $1.5 billion, or $5.29 per share, compared to $1.3 billion, or $4.39 per share, in the fourth quarter of 2018. Cash from operations in the fourth quarter of 2019 was $1.5 billion, after discretionary pension contributions of $1.0 billion, compared to cash from operations of $2.2 billion in the fourth quarter of 2018.
"The corporation delivered outstanding performance throughout 2019, achieving exceptional sales growth, strong earnings, cash from operations, and a record backlog," said Lockheed Martin Chairman, President and CEO Marillyn Hewson. "As we look ahead to 2020, we remain focused on providing innovative global solutions for our customers, investing for growth across our portfolio, and generating long-term value for our shareholders."
2020 Financial Outlook
The following table and other sections of this news release contain forward-looking statements, which are based on the corporation's current expectations. Actual results may differ materially from those projected. It is the corporation's typical practice not to incorporate adjustments into its financial outlook for proposed acquisitions, divestitures, joint ventures, changes in law, or new accounting standards until such items have been consummated, enacted or adopted. For additional factors that may impact the corporation's actual results, refer to the "Forward-Looking Statements" section in this news release.
2020 Financial Outlook
The following table and other sections of this news release contain forward-looking statements, which are based on the corporation's current expectations. Actual results may differ materially from those projected. It is the corporation's typical practice not to incorporate adjustments into its financial outlook for proposed acquisitions, divestitures, joint ventures, changes in law, or new accounting standards until such items have been consummated, enacted or adopted. For additional factors that may impact the corporation's actual results, refer to the "Forward-Looking Statements" section in this news release.
Lockheed Martin (NYSE: LMT) stock price history
The image below, obtained from Google, shows the stock price history of Lockheed Martin over the last 5 years. And it's been a good time for Lockheed Martin stockholders. 5 years ago the stock was trading at around $195 a stock and its currently trading at $435.90 a stock. That's a very strong return of 128% provided to Lockheed Martin stockholders over the last 5 years.
The stock of Lockheed Martin is trading at a lot closer to its 52 week high of $438.99 than it is to its 52 week low of $286.77 which to us is an indication that the momentum and sentiment of Lockheed Martin stock is very positive at this point in time.
The stock of Lockheed Martin is trading at a lot closer to its 52 week high of $438.99 than it is to its 52 week low of $286.77 which to us is an indication that the momentum and sentiment of Lockheed Martin stock is very positive at this point in time.
Recent coverage of Lockheed Martin
The extract below discusses the latest news regarding Lockheed Martin as obtained from TheStreet.com
Lockheed Martin (LMT) - Get Report was rising Tuesday, hitting new all-time highs after better-than-expected fourth-quarter earnings. However, the rally was perhaps more meek than investors would have expected. Shares gained about 0.7%, lagging the S&P 500’s 1% gain, despite beating top- and bottom-line estimates.
Earnings of $5.29 a share beat analysts’ expectations by 25 cents, while revenue of $15.88 billion grew 10.2% year over year and topped estimates by $600 million. The stock wavered a bit over the past few sessions, but nowhere near as much as most stocks. In fact, several defense stocks - like Northrop Grumman (NOC) - Get Report or United Technologies (UTX) - Get Report - hover near their highs too. Lockheed Martin remains in a very strong uptrend and continues to power higher. Until that changes, there’s little reason to bet against the name. Let’s look at the chart to see when that may happen.
Read the full article here
Lockheed Martin (LMT) - Get Report was rising Tuesday, hitting new all-time highs after better-than-expected fourth-quarter earnings. However, the rally was perhaps more meek than investors would have expected. Shares gained about 0.7%, lagging the S&P 500’s 1% gain, despite beating top- and bottom-line estimates.
Earnings of $5.29 a share beat analysts’ expectations by 25 cents, while revenue of $15.88 billion grew 10.2% year over year and topped estimates by $600 million. The stock wavered a bit over the past few sessions, but nowhere near as much as most stocks. In fact, several defense stocks - like Northrop Grumman (NOC) - Get Report or United Technologies (UTX) - Get Report - hover near their highs too. Lockheed Martin remains in a very strong uptrend and continues to power higher. Until that changes, there’s little reason to bet against the name. Let’s look at the chart to see when that may happen.
Read the full article here
Lockheed Martin (NYSE: LMT) latest stock valuation
So what is Lockheed Martin stock worth based on the release of their latest earnings report and their outlook provided? Based on Lockheed Martin latest earnings report our valuation models provide a target (full value) price for Lockheed Martin stock at $351.20 a stock (which is up slightly from our 3rd quarter 2019 earnings report valuation of Lockheed Martin). We therefore believe that the stock of Lockheed Martin is overvalued at its current price of $435.90
We usually suggest that long term and fundamental investors get in at least 10% below our target (full value) price which in this case is $351.20 Therefore we believe a good entry point into Lockheed Martin stock is at $316.10 or below. We expect the stock of Lockheed Martin to pull back from current levels in coming weeks and months to levels closer to our target price (full value price) as we cannot see the group holding on to its current lofty valuation levels.
We usually suggest that long term and fundamental investors get in at least 10% below our target (full value) price which in this case is $351.20 Therefore we believe a good entry point into Lockheed Martin stock is at $316.10 or below. We expect the stock of Lockheed Martin to pull back from current levels in coming weeks and months to levels closer to our target price (full value price) as we cannot see the group holding on to its current lofty valuation levels.
Next earnings release date for Lockheed Martin
It is expected that Lockheed Martin (NYSE: LMT) will release their 1st quarter 2020 earnings towards the end of April 2020