Global arms giant Lockheed Martin (LMT.US) is facing another wave of orders for modern F-35 Lightning II fighter jets. Israel announced Tuesday that it has signed a $3 billion deal to buy a third squadron of 25 fighters, delivery of which will begin in 2028 (this will bring the total to 75 machines on Israel's side; the only country in the Middle East to have such machines). Similar interest has been signaled by the United Kingdom, which is expected to increase its arsenal of such machines by 27 fighters (to date, the country has 33 aircraft of this class, out of the 48 ordered so far).
The new order could expand the potential range of projections, regarding the company's financial performance in 2024. In April, the company reported that the current order backlog stood at $159 billion. The company's most important business sector is the aerospace division. Although there were no final deliveries of F-35 aircraft in the first quarter, the company still expects to deliver between 75 and 110 aircraft in 2024, which requires timely receipt of the necessary hardware from TR-3 (advanced cockpit operating software) suppliers. This quarter, the Czech Republic became the 18th country to join the global F-35 team, signing a letter of offer and acceptance, officially expressing its intention to procure 24 F-35 aircraft. In addition, the US State Department has approved potential foreign military sales to Greece of up to 40 F-35 aircraft.
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Thus, it seems that the outlook presented by the company could be revised upward in future quarters. On the other hand, however, the company is struggling with a number of issues on the supply side and its ability to impose a price (due to its status as a government supplier). Source: Lockheed Martin Q1
This can be seen primarily on the margin side, which has declined in recent quarters. Source: XTB
Analyzing the company from the fundamental-comparative side, we can see that an analysis of the estimated price/earnings multipliers projected for the next 12 months and 24 months indicates that the current valuation of the stock at $465 seems slightly above the 3-year average. Particularly for the estimated results for 2025, the current valuation appears to be slightly off the statistical average.
Company earnings forecasts for the next two years and historical readings.
Source: Bloomberg Financial LP
The company's shares have gained 4.1% since the beginning of the year. They are currently oscillating in the region of historical highs. Source: xStation
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