Lockheed Martin Corporation (LMT), headquartered in Bethesda, Maryland, is a security and aerospace firm specializing in the research, design, development, manufacturing, integration, and sustainment of technology systems, products, and services. Valued at a market capitalization of $128.5 billion, the company operates across various sectors, including space, telecommunications, electronics, information and services, aeronautics, energy, and systems integration.

Shares of this aerospace and defense giant have underperformed the broader market considerably over the past year. LMT has gained 20.4% over this time frame, while the broader S&P 500 Index ($SPX) has rallied nearly 31%. In 2024, LMT stock is up 19.6%, surpassing SPX’s 25.2% rise on a YTD basis.

Narrowing the focus, LMT has also lagged behind the iShares U.S. Aerospace & Defense ETF (ITA). The exchange-traded fund has gained about 31% over the past year and returned 22.1% this year. 

Despite its underwhelming price action over the past year, Lockheed Martin is expected to see revenue growth driven by a steady inflow of orders for its diverse defense products, strong international market presence, and a solid order backlog.

On Nov. 19, Lockheed Martin shares saw a marginal rise, along with other defense stocks, due to the escalation of hostilities between Ukraine and Russia.

However, LMT stock saw a decline of more than 3% on Nov. 14, along with other defense stocks, following President-elect Trump's announcement of Elon Musk and Vivek Ramaswamy leading a government spending cut commission, which raised concerns about potential reductions in government contracts.

For the current fiscal year, ending in December, analysts expect LMT’s EPS to decline 3.3% to $26.89 on a diluted basis. The company’s earnings surprise history is impressive. It beat the consensus estimate in each of the last four quarters.

Among the 21 analysts covering LMT stock, the consensus is a “Moderate Buy.” That’s based on 11 “Strong Buy” ratings, one “Moderate Buy,” eight “Holds,” and one “Strong Sell.”

This configuration is more bullish than three months ago with 10 analysts suggesting a “Strong Buy.”

On Oct. 23, RBC Capital lowered Lockheed Martin's price target to $665 from $675, while maintaining an “Outperform” rating. The price cut reflects concerns over soft Q3 sales, though the analyst views the company's initial 2025 outlook as potentially conservative. RBC highlighted strong sales and operating profit growth in the Missiles and Fire Control segment and noted that the F-35 recovery is "on track," which supports a positive outlook for 2025.

LMT’s mean price target of $607.33 indicates a premium of 12% from the prevailing market prices. The Street-high price target of $704 suggests an upside potential of 29.8%.