Lockheed Martin (NYSE: LMT) is scheduled to report its Q3 2022 results on Tuesday, October 18. We expect Lockheed Martin
LMT
(1) Revenues expected to be above the consensus estimates
- Trefis estimates Lockheed Martin’s Q3 2022 revenues to be around $16.8 billion, reflecting mid-single-digit y-o-y growth and slightly above the $16.6 billion consensus estimate.
- With the rising macroeconomic tensions, it is likely that governments will resort to increased spending on defense, and Lockheed Martin should benefit from the same. However, supply chain disruptions may weigh on the company’s top-line growth in the near term.
- Looking at Q2 2022, the company saw its sales decline 9% y-o-y to $15.4 billion. The decline was seen across segments.
- Our dashboard on Lockheed Martin Revenues has more details on the company’s segments.
(2) EPS likely to be above the consensus estimates
- Lockheed Martin’s Q3 2022 adjusted earnings per share is expected to be $6.78 per Trefis analysis, above the consensus estimate of $6.68.
- The company’s net income of $1.7 billion in Q2 2022 reflected a 6% drop from its $1.8 billion figure in the prior-year quarter due to lower sales.
- For the full-year 2022, we expect the adjusted EPS to be lower at $22.34 compared to the EPS of $22.76 in 2021.
(3) LMT stock looks reasonably valued
- We estimate Lockheed Martin’s Valuation to be around $445 per share, which is only 8% above the current market price of $410, implying that investors may be better off waiting for a dip to enter LMT stock for better gains in the long run.
- At its current levels, LMT stock is already trading at 18x forward EPS estimate of $22.34, compared to the last three-year average of 15x.
- However, if the company reports upbeat Q2 results and provides an outlook better than the street estimates, the P/E multiple will likely be revised upward, resulting in higher levels for LMT stock.
While LMT stock looks like it has only a little room for growth, it is helpful to see how Lockheed Martin’s Peers fare on metrics that matter. You will find other valuable comparisons for companies across industries at Peer Comparisons.
Furthermore, the Covid-19 crisis has created many pricing discontinuities which can offer attractive trading opportunities. For example, you’ll be surprised how counter-intuitive the stock valuation is for Aerojet Rocketdyne vs. Brink’s Company.
Despite inflation rising and the Fed raising interest rates, among other factors, LMT stock has risen 16% this year. But can it drop from here? See how low Lockheed Martin stock can go by comparing its decline in previous market crashes. Here is a performance summary of all stocks in previous market crashes.
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Read More: What To Expect From Lockheed Martin’s Q3?