Why Lockheed Martin Stock Is Outperforming

Lockheed Martin Stock

A recent victory for the Space business unit of Lockheed Martin Corp. (NYSE:LMT), which involved the development of missiles, resulted in securing a modification contract. The Strategic Systems Programs in Washington, District of Columbia, is the organization giving out the prize.

The Specifics of the Transaction

The completion of the contract, which has a total value of 260,8 million dollars, is anticipated to occur on November 9th, 2026. Per the agreement stipulations, Lockheed will lend its expertise in program management, engineering development, system integration, long lead material, and specialized tooling and equipment to the missile manufacturing process.

Most of the work associated with this transaction will be carried out in both Sunnyvale, California, and Denver, Colorado.

Why Does Lockheed Martin Stock and Business Doing So Well?

The growing geopolitical and socio-economic unrest throughout the world has driven countries all over the world, both developed and developing, to increase the size of their individual military arsenals, with missiles making up a considerable percentage of that inventory.

In addition to manufacturing satellites and systems for transporting people and cargo into space, the Space business section of Lockheed also produces strike missile systems. One of its primary programs is the Trident II D5 Fleet Ballistic Missile (FBM), the only submarine-launched intercontinental ballistic missile currently being produced in the United States. This program is run in conjunction with the United States Navy. Due to the missile’s sea-based deterrent, it is impossible to follow its movements while in operation.

Lockheed Martin has a solid demand base in the missile defense market because it is one of the most important missile manufacturers in the United States and has such an impressive missile in its product catalog. The most recent successful bid on a contract is a shining illustration of that.

Opportunities for Expanding

According to a report by Mordor Intelligence, the market for missiles and missile defense systems is expected to experience a compound annual growth rate (CAGR) of 4.9% between 2022 and 2027. Lockheed Martin, which already holds a strong position in the military missile industry, is in a good place to reap the benefits of this developing sector. The following list includes notable defense majors that have been producing missiles for the defense sector and are projected to enjoy the benefits of growing demand:

Northrop Grumman (NYSE:NOC) is a leading developer of missile systems and counter systems, including strategic deterrents, subsystems, and components. Orbital ATK was one of the industry leaders in providing missile components across air, sea, and land-based systems before Northrop acquired it in 2018. Northrop made this move in 2018 to improve its position in the missile market.

Earnings at Northrop Grumman are expected to grow at a long-term pace of 3.3%. Investors in NOC have had a return of 23.2% over the past year.

Missiles & Defense, a division of Raytheon Technologies (NYSE:RTX), is a market leader in integrated air and missile defense system design, development, integration, production, and maintenance. The United States Department of Defense utilizes the unit’s services as a prime contractor or a critical subcontractor on various missiles and associated programs.

It is estimated that Raytheon’s long-term earnings growth rate will be 9.5%. The value of an investor’s RTX shareholdings increased by 11% over the past year.

Ordnance and Tactical Systems, a division of General Dynamics (NYSE:GD), is the company in charge of the system integration for the 2.75-inch Hydra-70 family of rockets. Additionally, it manufactures composite rocket motor cases and launch tubes for strategic and tactical missiles.

According to General Dynamics, the company’s long-term earnings growth rate is 9.3%. Shares of General Dynamics have generated a return of 16.4% over the past year.

Lockheed Martin Stock Price

Lockheed Martin’s share price has increased by 26.4% over the past year, compared to a decline of 3.5% for the industry as a whole.

Featured Image: Megapixl @ Mohammedsoliman4

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About the author: Stephanie Bedard-Chateauneuf has over four years of experience writing financial content for various websites. Over the years, Stephanie has covered various industries, with a primary focus on consumer stocks, cannabis stocks, tech stocks, and personal finance. This stock lover likes to invest for the long-term. Stephanie has an MBA in finance.