Aerospace and global security systems providerLockheed Martin
) pays a hefty dividend.
The annualized yield is 3.7%, which easily trumps the S&P
500's 2.52% yield.
The large-cap company has doubled the payout in the past four
Stock-price appreciation has been excellent this year. The
stock is up nearly 35% year to date.
Lockheed builds and sells military aircraft but it also
provides cybersecurity IT services. For example, the company
recently won a cybersecurity contract with the Department of
Revenue in Q2 broke down this way: 18% for information
systems, 30% aeronautics, 18% missiles and fire control, 18%
space and 16% mission systems and training.
Last year, 82% of sales were to the U.S. government and 17% to
Earnings grew 1%, 5% and 5% in 2010-12, a sharp decline from
2007's 28% pop. Revenue growth has been in single digits since
The stock is extended from a bounce off the 50-day line in
July. A new base, if it were to form, would be stage two. A
first- or second-stage breakout is more likely to work than a
The biggest risk for Lockheed is the U.S. government's debt
and budget mess, which some believe may eventually inspire
The chaos in Egypt also raises concerns, including talk that
the U.S. might cut aid to Egypt. The U.S. provides $1.3 billion
for Egypt to use to buy military equipment from U.S. businesses.
The money never leaves the U.S. In a way, aid to Egypt might be
more accurately described as aid to U.S. military
Lockheed has benefited from this in the past, but it's not as
if Egypt is in a position to end payments.