Morgan Stanley has bumped up its rating on $LMT from “Equal-Weight” to “Overweight,” lifting its price target to $575. This signals growing confidence in Lockheed Martin’s trajectory, particularly with its current share price still hovering below that target, giving investors solid upside potential.
🛡️ A key driver behind the upgrade is $LMT’s underperformance relative to its defense peers so far this year, despite continued strength in fundamentals. The stock is down slightly, while competitors have notched meaningful gains. However, the long-term positioning remains strong, especially with global geopolitical tensions fueling defense budgets.
🌍 Importantly, $LMT boasts significant international exposure — around 27% of total sales and 30% of its backlog come from outside the U.S. As international defense spending ramps up, this puts the company in a prime spot to capture demand through major platforms like the F-35, missile defense systems, and space-related technologies.
📊 Although there were some setbacks, including a recent pre-tax charge and questions around F-35 deliveries, Morgan Stanley believes these issues are now largely resolved. Additionally, $LMT is currently trading at a valuation discount to its peer group, offering further appeal to value-conscious investors.
💸 On the income front, $LMT is a dividend powerhouse. It currently yields 2.62%, paying $13.20 annually per share. With a payout ratio under 45%, the dividend remains sustainable, backed by consistent earnings. Even more appealing — the company has increased its dividend for over 20 years straight, reinforcing its status as a reliable income generator.
🧠 For investors seeking a combination of global exposure, defensive growth, and stable income, $LMT stands out as a stock with renewed momentum and strong institutional backing.