LMT - Terran Orbital Is Unattractive Given Lockheed Martin's Takeover Offer

2024-04-01 02:12:51 ET

Summary

• Terran Orbital, a small satellite manufacturer, has significant commercial revenues and is winning notable new contracts.
• LLAP has a weak balance sheet, and Lockheed is seemingly taking advantage of this with a lowball takeover offer.
• I believe Terran shares are not a great opportunity today, given the decent probability that Lockheed's offer will go through and lock in losses compared to today's share price.
• As a Lockheed Martin shareholder, however, I find this venture capital-style approach to the space industry intriguing.

Over the past couple of years, investors have been paying a lot more attention to space. Billionaires such as Elon Musk and Jeff Bezos have put tons of their own capital into the arena....

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