LMT - Lockheed Martin: Robust Backlog Points To Sustained Growth

2024-03-24 07:50:20 ET

Summary

• Lockheed Martin has a record backlog of $160.57 billion, reflecting strong demand for its defense tech solutions.
• Geopolitical tensions and increased defense spending could benefit Lockheed Martin's sales and profit growth.
• Yet, the stock is trading at a reasonable valuation and offers a potential return far exceeding that of the overall market.

Record backlog

My goal for this article is to argue for a buy thesis on Lockheed Martin (LMT). I will argue that the stock presents a solid buying opportunity considering the demand for its products with all the ongoing geopolitical conflicts, the record backlog reported in 2023 Q4, and also the attractive P/E. The many geopolitical tensions around the globe could lead to increased defense spending, directly benefiting LMT. And this is reflected in the record backlog reported in Q4 2023 (see the chart below). Its current backlog sits at a whopping $160.57B. As commented by its President and CEO Jim Taiclet ,...

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