Lockheed Martin (LMT) Stock Forecast & Price Target

Lockheed Martin's financial performance showcases a robust upward trend, with the missiles and fire control (MFC) segment achieving a revenue increase of 10.6% year-over-year, reflecting strong demand driven by the JASSM and LRASM programs. Additionally, the aeronautics segment, primarily reliant on F-35 volumes, reported a revenue increase of 1.9% year-over-year, indicating stable growth amid increasing global defense spending. Overall, the company's expectation for MFC segment growth of approximately 12% through 2025 further reinforces a positive outlook due to anticipated heightened funding for missile and defense systems both domestically and internationally.

Lockheed Martin's financial outlook is negatively impacted by a significant reduction in FY26 free cash flow (FCF) guidance to approximately $6 billion, reflecting a year-over-year decline from prior expectations of low single-digit to mid-single-digit growth. The company reported a disappointing performance in 2Q25, with approximately $1.6 billion in program losses leading to a 2% revenue miss, a 71% miss in segment operating income, and a 78% earnings per share (EPS) miss, all contributing to a notable decline in investor confidence regarding program execution. Additionally, operating margins across several segments exhibited alarming declines, particularly in Aeronautics and Rotary and Mission Systems, further underscoring the ongoing operational challenges faced by the company.