Analysts Are Updating Their Lockheed Martin Corporation (NYSE:LMT) Estimates After Its Third-Quarter Results
Lockheed Martin Corporation (NYSE:LMT) shareholders are probably feeling a little disappointed, since its shares fell 4.4% to US$369 in the week after its latest quarterly results. Results overall were respectable, with statutory earnings of US$6.05 per share roughly in line with what the analysts had forecast. Revenues of US$16b came in 2.2% ahead of analyst predictions. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there’s been a strong change in the company’s prospects, or if it’s business as usual. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.
See our latest analysis for Lockheed Martin
Taking into account the latest results, the current consensus from Lockheed Martin’s 18 analysts is for revenues of US$68.2b in 2021, which would reflect a satisfactory 6.1% increase on its sales over the past 12 months. Statutory earnings per share are predicted to climb 12% to US$26.40. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$68.2b and earnings per share (EPS) of US$26.64 in 2021. The consensus analysts don’t seem to have seen anything in these results that would have changed their view on the business, given there’s been no major change to their estimates.
There were no changes to revenue or earnings estimates or the price target of US$436, suggesting that the company has met expectations in its recent result. That’s not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. The most optimistic Lockheed Martin analyst has a price target of US$509 per share, while the most pessimistic values it at US$390. Still, with such a tight range of estimates, it suggeststhe analysts have a pretty good idea of what they think the company is worth.
One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. It’s pretty clear that there is an expectation that Lockheed Martin’s revenue growth will slow down substantially, with revenues next year expected to grow 6.1%, compared to a historical growth rate of 9.0% over the past five years. Compare this to the 72 other companies in this industry with analyst coverage, which are forecast to grow their revenue at 6.0% per year. Factoring in the forecast slowdown in growth, it looks like Lockheed Martin is forecast to grow at about the same rate as the wider industry.
The Bottom Line
The most obvious conclusion is that there’s been no major change in the business’ prospects in recent times, with the analysts holding their earnings forecasts steady, in line with previous estimates. They also reconfirmed their revenue estimates, with the company predicted to grow at about the same rate as the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.
Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. At Simply Wall St, we have a full range of analyst estimates for Lockheed Martin going out to 2024, and you can see them free on our platform here..
You should always think about risks though. Case in point, we’ve spotted 1 warning sign for Lockheed Martin you should be aware of.
This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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