The interim peace agreement between the U.S. and Iran has reduced conflict risk, and Lockheed Martin (LMT) is feeling the impact, with defense stocks facing a broad reset in expectations for new weapons demand.

Lockheed Martin’s share price has come under pressure, with a 1-day share price return showing a 4.01% decline and a 90-day share price return showing a 17.09% decline. However, the 1-year total shareholder return of 11.51% and 5-year total shareholder return of 53.05% still point to positive longer term results.

If you are reassessing defense exposure after the recent peace agreement headlines, it could be a moment to look at other areas of the market through the 34 power grid technology and infrastructure stocks

With Lockheed Martin stock now trading below some intrinsic value estimates and sitting at a more than 17% decline over 90 days, you have to ask: is this a reset that opens a buying opportunity, or is the market already pricing in future growth?

Most Popular Narrative: 24.2% Undervalued

According to a widely followed narrative on Lockheed Martin, a fair value of $673.88 sits well above the recent $510.95 close. This framing puts the current reset in a very different light.

Orbit is the long-term bet: space is becoming a must-have layer of modern defense, like “roads and rails” for information and targeting.

Curious what sits behind that space first mindset and the implied upside for Lockheed Martin? The narrative leans heavily on specific revenue growth, margin recovery and a richer future profit multiple that together support a fair value well above today’s price.

Result: Fair Value of $673.88 (UNDERVALUED)

However, this bullish Lockheed Martin narrative still depends on two big swing factors: margin execution in complex space programs and the concentration of revenue with the U.S. government.

Next Steps

With mixed sentiment around Lockheed Martin after the recent reset, it makes sense to move quickly, review the underlying data, and weigh both sides of the story for yourself by checking the 5 key rewards and 1 important warning sign

Looking for more investment ideas beyond Lockheed Martin?

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.