LMT · Lockheed Martin Corporation

The thesis

Lockheed Martin's business is running ahead of its own plan, but its shares remain caught in a sector-wide defense sell-off that good company news has not reversed. On 23 July 2026 the company raised its 2026 guidance on a record $230 billion backlog. The third-quarter report before the open on 22 October 2026 shows whether results can outweigh the peace-talk and budget headlines.

The shares closed at $507.89 on 8 October 2026, 24.0% below the 52-week high of $668.17 and 1.9% lower over three months, based on adjusted daily closes. That is little changed from the $509.25 close on 30 September 2026. The 14-day relative strength index (RSI), a momentum gauge where readings under 30 usually mark oversold shares, stood at 29.1.

The narrative is saturated: the defense bear market was mainstream news by 29 September 2026, and four analyst initiations or reiterations between 6 October 2026 and 8 October 2026 did not lift the shares. The odds that the shares beat the S&P 500 over the next three months still look slightly worse than even. The company's results are strong, but every piece of good news since mid-August has been absorbed by sector selling.

Bullish and bearish views on Lockheed Martin Corporation

The bull case on Lockheed Martin Corporation (LMT), in brief: Guidance went up in July. The bear case: The sector is in a bear market.

Bull case

• Guidance went up in July. On 23 July 2026 Lockheed Martin raised its 2026 sales outlook to $79.75–81.75 billion, from $77.5–80.0 billion. Diluted earnings per share (EPS) guidance rose to $29.95–30.65, from $29.35–30.25.
• Record backlog after $65 billion of orders. Second-quarter orders of $65 billion took backlog to a record $230 billion, including the multi-year THAAD (Terminal High Altitude Area Defense) interceptor contract (company release, 23 July 2026).
• Cash flow has recovered. Second-quarter 2026 free cash flow was $2.9 billion, against negative $150 million a year earlier (company release, 23 July 2026).
• The PAC-3 missile ramp is reaching suppliers. Boeing won a seven-year contract of about $14.7 billion from Lockheed Martin to triple production of PAC-3 MSE (Missile Segment Enhancement) seekers (Benzinga, 5 October 2026). The award shows Patriot interceptor volumes rising for years.
• New analyst coverage is mostly positive. Rothschild & Co Redburn started coverage at buy with a $650 target on 6 October 2026. Susquehanna kept a buy and a $700 target on 7 October 2026, and Citi kept a buy and a $691 target on 8 October 2026 (StockAnalysis).
• Export demand for the F-35 is widening. The State Department approved a potential F-35 sale to Saudi Arabia worth about $24.3 billion (reported 17 September 2026). Portugal's foreign minister said on 8 October 2026 that the government is seriously considering an F-35 proposal.

Bear case

• The sector is in a bear market. The SPDR S&P Aerospace & Defense ETF (XAR) was 21% below its 14 August 2026 close of $296.73 after a record seven-week losing run (Benzinga, 29 September 2026). Lockheed Martin fell 7.7% in September.
• Not every new analyst is positive. Barclays started coverage on 8 October 2026 with a hold rating and a $554 target. The lowest target on StockAnalysis is $503, just under the 8 October 2026 close.
• Peace headlines hit defense shares. On 22 September 2026 Lockheed Martin and RTX each fell about 3% on reports that Iran had offered to reopen the Strait of Hormuz (24/7 Wall St.).
• The budget is frozen at 2026 levels. A stopgap funding bill holds spending flat through 11 December 2026, which delays new programme starts.
• The F-35 parts probe keeps widening. Bloomberg reported on 7 October 2026 that a UPS worker missed a security email, letting F-35 parts reach China. This follows Politico's 18 September 2026 report of a congressional investigation.
• Pentagon money is moving to newer suppliers. Bloomberg reported on 30 September 2026 that Defense Secretary Hegseth would unveil a new Pentagon drone group.

Price setup

The shares closed at $507.89 on 8 October 2026 after trading as low as $497.00 that day (StockAnalysis). They have held roughly flat since the $509.25 close on 30 September 2026. The 52-week high of $668.17 sits 24.0% above.

There is no sign of crowding. The RSI reading of 29.1 marks oversold shares rather than a crowded rally. The imminent catalyst is the 22 October 2026 report. The consensus target is $625.76 across 23 analysts (StockAnalysis, 8 October 2026), so the shares trade well below where most analysts value them. That gap has existed since August without closing.

Catalysts, next 30 days

• 22 October 2026 — Third-quarter 2026 results, published before the market opens, with a call at 8:30 a.m. ET (company release, 1 October 2026). The report shows whether the raised 2026 guidance and the $230 billion backlog hold.
• 3 November 2026 — US midterm elections. The result shapes the 2027 defense budget. President Trump told Time on 1 October 2026 that Iran strikes could increase after the midterms if there is no deal.
• 11 December 2026 — Federal stopgap funding expires. A full-year appropriation would release new missile and aircraft money; another stopgap would extend the freeze.

What would change the view

The case breaks if the 22 October 2026 report cuts 2026 sales guidance below $79.75 billion or EPS guidance below $29.95, or discloses a large loss on a fixed-price programme. A signed US–Iran agreement to reopen the Strait of Hormuz would also remove part of the geopolitical premium in defense shares. On price, a daily close below $475 would put the shares well under the 8 October 2026 intraday low of $497.00, a sign that sector selling is overriding results.

The read would improve if the third-quarter report keeps or raises guidance and the shares close higher on the day. That would be the first sign that company results are separating Lockheed Martin from the sector sell-off. A full-year defense appropriation before 11 December 2026 would strengthen the case further.

What it trades with

Lockheed Martin trades with the defense sector as a group. It fell alongside RTX on the 22 September 2026 Iran report, and its 7.7% September decline tracked the XAR slide (Benzinga, 29 September 2026). Iran and Strait of Hormuz headlines move defense shares and oil in the same direction. Shared customers and programmes tie it closely to RTX, Northrop Grumman and Boeing's defense unit, which now builds PAC-3 seekers under the 5 October 2026 contract.