Deutsche Bank's Scott Deuschle initiated their coverage on Lockheed Martin (NYSE: LMT) with a Hold rating and a $435 price target. In their analysis, Deuschle highlighted the positive momentum in Lockheed Martin's order flow, which is expected to drive growth in the coming years. According to Deuschle, this momentum has the potential to exceed consensus revenue estimates, offering solid upside potential for the company.
However, Deuschle also raised some concerns regarding inflation-driven margin pressure, which may impact Lockheed Martin's profitability. The analyst noted that the market is increasingly focusing on margin performance rather than revenue, which could pose challenges for the company. Additionally, Deuschle pointed out the F-35 delivery halt as another worry, as it may impact the company's free cash flow for FY 2023 and create headwinds for FY 2024 margins.
Currently, 20% of top-rated analysts consider Lockheed Martin a Strong Buy or Buy, while 80% view it as a Hold. No analysts recommend selling the stock. This mixed sentiment reflects the varying opinions among analysts regarding the company's future performance.
The consensus forecast among analysts is that Lockheed Martin's upcoming year will deliver earnings per share (EPS) of $27.93. If these projections hold true, it would represent a 2% increase on a year-over-year basis for the company.
Looking at Lockheed Martin's stock performance, it has experienced a 10.5% decline since its last quarterly report on June 25, 2023. However, on a year-over-year basis, the stock has shown a 2.7% increase. It is worth noting that during this period, Lockheed Martin has trailed behind the broader market, with the S&P 500 seeing a significant rise of 15.6%.
Scott Deuschle, the Deutsche Bank analyst behind this rating, is ranked in the top 28% of Wall Street analysts by WallStreetZen. With an average return of 2.4% and a win rate of 34.2%, Deuschle specializes in the Technology and Industrials sectors.
Lockheed Martin Corporation, founded in 1912 and headquartered in Bethesda, MD, offers a range of combat and air mobility aircraft, unmanned air vehicles, and related technologies. The company also provides air and missile defense systems, tactical missiles, and air-to-ground precision strike weapon systems, among other offerings. Additionally, Lockheed Martin is involved in logistics, integration services, energy management solutions, and the production of commercial helicopters and surface ships. The company plays a significant role in the defense and aerospace industry.
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