• Lockheed Martin reported past second-quarter 2026 results showing sales of US$20.06 billion and net income of US$1.84 billion, with basic EPS from continuing operations of US$7.98, up sharply from a year earlier.
• The company’s first-half 2026 sales of US$38.08 billion and net income of US$3.32 billion highlight how higher earnings are coinciding with an expanding backlog and large new defense awards.
• With stronger earnings and a record contract backlog now on the table, we’ll assess how this shapes Lockheed Martin’s investment narrative.

Find 38 companies with promising cash flow potential yet trading below their fair value.

Lockheed Martin Investment Narrative Recap

To own Lockheed Martin, you need to believe that demand for its high‑end defense systems will stay resilient and that its large contract backlog will keep converting into profitable work. The latest quarter’s stronger earnings and record US$230.4 billion backlog support that view, while also easing near term worries about margin pressure from legacy fixed price programs. The biggest swing factor remains future U.S. and allied budget priorities, where any shift away from key platforms could quickly change the outlook.

Among recent announcements, the US$10.5 billion, 12‑year GLSS2 logistics contract with U.S. Special Operations Command stands out. It reinforces Lockheed’s role in long term sustainment and services, which can provide more recurring revenue alongside big hardware programs. Together with new Q2 awards in missile defense and munitions, this win ties directly into the current catalyst of backlog growth, but it does not remove the underlying exposure to changing defense spending priorities.

Lockheed Martin’s narrative projects $88.0 billion revenue and $8.0 billion earnings by 2029.

Uncover how Lockheed Martin's forecasts yield a $606.68 fair value, a 7% upside to its current price.

Exploring Other Perspectives

Yet for all the optimism around record backlog, investors should also be aware of the risk that shifting defense budgets and program cuts could...

Some of the lowest ranked analysts came into this quarter expecting only about US$84.0 billion of revenue and US$7.9 billion of earnings by 2029, and they worry that ongoing cost overruns and reach forward losses could keep margins under pressure even as new contracts like GLSS2 are signed. Their view is far more cautious than the consensus, and this latest beat and backlog jump may or may not be enough to change that story, which is why it is worth comparing several perspectives before you decide where you stand.

Explore 10 other fair value estimates on Lockheed Martin - why the stock might be worth as much as 52% more than the current price!

The Verdict Is Yours

Disagree with existing narratives? Extraordinary investment returns rarely come from following the herd, so go with your instincts.

• A great starting point for your Lockheed Martin research is our analysis highlighting 4 key rewards and 1 important warning sign that could impact your investment decision.
• Our free Lockheed Martin research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate Lockheed Martin's overall financial health at a glance.

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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.