Lockheed Martin Corporation is a security and aerospace company. It operates through four segments. The aeronautics segment is engaged in the research, design, development, manufacture, support, and upgrade of military aircraft, including combat and air mobility aircraft, unmanned air vehicles, and related technologies. Missiles and Fire Control segment provides air and missile defense systems; fire control systems; manned and unmanned ground vehicles, and energy management solutions. Rotary and Mission Systems segment provides design, manufacture, service, and support for various military and commercial helicopters, surface ships, sea, and land-based missile defense systems, radar systems, sea, and air-based mission and combat systems, command and control mission solutions, cyber solutions, and simulation and training solutions. The space segment is engaged in the research and development, design, engineering, and production of satellites, missile systems, and space transportation systems.
- Looking at the quick view investors should note a few significant changes in Lockheed Martin’s fundamental valuation.
- First is the notable declines in both Return on Equity (ROE), as well as a significant decline in Financial Leverage (Assets/Equity).
- While most other metrics are progressing normally we also see significant declines in growth rates; Investors should note significant losses in Revenue, Net Income, Earnings Per Share (EPS) as well as Dividends Per Share (DPS) relative to their 5-year averages.
- The one positive metric for Lockheed Martin is the significant rise in Book Value Per Share, from a 5 year average of 16.098 to a current rate of 97.266.
- Looking deeper into the Q3 filings, the company expected to see lower 2022 revenues as a result of declining government spending and purported secondary effects from the ongoing state of emergency.
- The company however has returned value to investors from both dividends and share repurchase programs.
- Also as a result of the crisis which began in early 2020, Lockheed Martin is reporting a heavy backlog of orders.
Overall Lockheed Martin has more than a few hurdles to jump through to return investor confidence and return their share price to what it was before the crisis of 2020. Investors should keep a keen eye on improving fundamentals moving forwards as Lockheed Martin attempts to fulfill the current backlog of orders and expand their operations into the hypersonics arena.
8/21/50/100/200dSMA: The Simple Moving Average is calculated by summing the closing prices of the security for a period of time and then dividing this total by the number of time periods. Sometimes called an arithmetic moving average, the SMA is basically the average stock price over time. As a trend develops, the moving average will slope in the direction of the trend, showing the trend direction and some indication of its strength based on the slope steepness.
Linear Regression: Linear regression analyzes two separate variables in order to define a single relationship. In chart analysis, this refers to the variables of price and time. Investors and traders who use charts recognize the ups and downs of price printed horizontally from day-to-day, minute-to-minute, or week-to-week, depending on the evaluated time frame.
Return on Equity: Return on equity (ROE) is a measure of financial performance calculated by dividing net income by shareholders’ equity. Because shareholders’ equity is equal to a company’s assets minus its debt, ROE is considered the return on net assets. ROE is considered a gauge of a corporation’s profitability and how efficient it is in generating profits.
Financial Leverage: Leverage results from using borrowed capital as a funding source when investing to expand the firm’s asset base and generate returns on risk capital. Leverage is an investment strategy of using borrowed money—specifically, the use of various financial instruments or borrowed capital—to increase the potential return of an investment. Leverage can also refer to the amount of debt a firm uses to finance assets.
Revenue: Revenue is the money generated from normal business operations, calculated as the average sales price times the number of units sold. It is the top line (or gross income) figure from which costs are subtracted to determine net income. Revenue is also known as sales on the income statement.
Net Income: Net income (NI), also called net earnings, is calculated as sales minus the cost of goods sold, selling, general and administrative expenses, operating expenses, depreciation, interest, taxes, and other expenses. It is a useful number for investors to assess how much revenue exceeds the expenses of an organization. This number appears on a company’s income statement and is also an indicator of a company’s profitability.
Earnings Per Share: Earnings per share (EPS) is calculated as a company’s profit divided by the outstanding shares of its common stock. The resulting number serves as an indicator of a company’s profitability. It is common for a company to report EPS that is adjusted for extraordinary items and potential share dilution.
Dividend Per Share: Dividend per share (DPS) is the sum of declared dividends issued by a company for every ordinary share outstanding. The figure is calculated by dividing the total dividends paid out by a business, including interim dividends, over a period of time, usually a year, by the number of outstanding ordinary shares issued.
Book Value Per Share: Book value per share (BVPS) is the ratio of equity available to common shareholders divided by the number of outstanding shares. This figure represents the minimum value of a company’s equity and measures the book value of a firm on a per-share basis.
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