Lockheed Martin (NYSE: LMT ) stock went balistic on Thursday, October 22, after the company announced terrific third-quarter 2026 results, beating both revenue and earnings Street expectations.
The defense contractor posted quarterly revenue of $20.71 billion, up approximately 11% year over year, surpassing analyst expectations of around $20.46 billion. Net earnings rose to approximately $1.85 billion, or $7.97 per share, compared with $6.95 per share in the same period last year.
Growth was led by the Missiles and Fire Control division, where revenue increased 24%, driven by higher production of PAC-3 and THAAD missile defense systems. Aeronautics revenue climbed 13%, reflecting increased F-35 jet production.
Now, the company’s backlog sits at a record $292 billion, while free cash flow totaled $3 billion for the quarter. As a result, LMT stock rose 6.33%, trading at $583.12 at press time.
LMT stock price one-day chart. Source: Finbold
Lockheed Martin raises full-year 2026 outlook: Is the stock a buy?
Following its strong quarterly performance, Lockheed Martin raised its full-year 2026 financial guidance for the second consecutive quarter. More precisely, the company now expects revenue of $80 billion to $82 billion, compared with its previous forecast of $79.75 billion to $81.75 billion.
Chairman, President and CEO Jim Taiclet attributed the improved outlook to sustained financial momentum across the company’s business portfolio, supported by strong demand for advanced defense technologies.
Likewise, the company announced a 10-year framework with the U.S. Department of War covering the production, spare parts, modification kits, and maintenance support of 850 U.S. F-35 fighter jets.
Investors immediately welcomed the news, as the company’s strong ties to U.S. government defense spending now provide an additional degree of business stability. Coupled with a dividend yield of around 2.6%, the setup appears to offer an attractive combination of relative value and income.
Potential risks with Lockheed Martin stock
Despite the appeal, however, contract execution risks are still present, as production challenges and delays have already been an issue earlier this year. Similarly, worries that the outlook might depend on the ongoing geopolitical tensions are likewise difficult to ignore.
Wall Street has also been split on the defense company. Over the past 90 days, analysts have collectively reted Lockheed a “Moderate Buy,” giving it a price target of $613.94, implying a modest 4.41% upside potential, per TipRanks .
LMT stock 12-month forecast. Source: TipRanks
However, the Wall Street consensus and the price target do not as of yet take into consideration the newly released quarterly earnings, meaning the data might tell a different story once the market has had time to digest the news.
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