Lockheed Martin Corporation
) was awarded a $50.2 million cost-plus-fixed-fee
incrementally-funded contract. This increment is worth $6.3
million. The award will involve data transport and
telecommunications services. Work on the contract will be
performed in Washington, D.C., with an estimated completion date
of Sep 30, 2013. The Army Contracting Command, Rock Island,
IL, is the contracting activity.
Lockheed Martin is the largest U.S. defense contractor with a
platform-centric focus and a steady inflow of follow-on orders
due to its leveraged presence in the Army, Air Force, Navy and IT
programs. However, the ongoing trend of governmental delays in
program decisions and even program cancellations have affected
the fortunes of the defense industry in general and Lockheed
Martin in particular.
Lockheed Martin finished 2012 with $82.3 billion of order
backlog, including $19.8 billion of new orders booked in the
fourth quarter. Of this $30.1 billion belonged to the Aeronautics
segment and $18.1 billion to the Space Systems segment. The rest
is made up of $14.7 billion for the Missiles and Fire Control
segment; $10.7 billion for Mission Systems and Training; and $8.7
billion for the Information Systems & Global Solutions.
Lockheed Martin is a well-managed defense prime. Its working
capital improvements continue to impress, as is evident from its
inventory turnover of 16.1 times in the trailing twelve months at
the end of 2012, compared to only 3.1 times for the Zacks
industry average - a strong sign of operational efficiency. In
addition, Lockheed's operational effectiveness is evident in its
industry-high Return on Investment of 34.9% in 2012.
Lockheed Martin has one of the strongest balance sheets among its
peers, with a stable long-term debt-to-capitalization of 80.2% at
the end of 2012. Lockheed continues to be a strong cash generator
with its operating cash flow reaching approximately $1.6 billion
Lockheed's premier position in the defense space is upheld by the
company's solid 2013 guidance. Lockheed Martin forecast full-year
2013 earnings per share in the range of $8.80-$9.10 on net
revenues of $44.5-$46.0 billion.
Lockheed Martin is a Zacks Rank #2 (Buy) stock. The past 60 days
have seen 12 of the 13 earnings estimates for full year 2013
moving up despite an industry-wide threat of budget cutbacks and
effects of sequestration. This has affected the fortunes of
defense companies like
Wesco Aircraft Holdings, Inc.
Other than Lockheed Martin, Zacks Rank #2 (Buy) stocks in the
defense space include
The Boeing Company
FLIR Systems, Inc.
BOEING CO (BA): Free Stock Analysis Report
FLIR SYSTEMS (FLIR): Free Stock Analysis
LOCKHEED MARTIN (LMT): Free Stock Analysis
WESCO AIRCRAFT (WAIR): Free Stock Analysis
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