Lockheed Martin (LMT) looks poised to deliver excellent financial results in 2026, and the firm’s efforts to massively expand its production capacity bode well for its outlook.
Meanwhile, LMT is developing new technologies that could improve its performance in the longer term, and new information provides further evidence of the strength of the firm’s missile defense and F-35 businesses.
Taken together, these points, along with the firm’s attractive valuation, make LMT a buy for conservative and value investors, as well as those looking for growth-at-a-reasonable-price names.
poised to Report Strong 2026 Results and Production Boosts Are Positive
The company expects its segment operating profit to jump more than 25% to between $8.425 billion and $8.675 billion in 2026 from $6.74 billion in 2025. Another indicator that the company will deliver strong results this year is its record $194 billion backlog as of the end of last year, representing a very healthy 17% increase versus the prior year and equivalent to about 2.5 times its annual revenue.
Turning to production, Lockheed is looking “to make a multibillion-dollar investment to accelerate munition production over the next 3 years, including building facilities across 5 states,” CEO James Taiclet reported on the company’s Q4 earnings call, held on January 29. Additionally, the firm will increase its annual production of Patriot anti-missile interceptors to 2,000 annually from about 600 currently.
These initiatives indicate that LMT is confident that the demand for these products will be quite powerful in the coming years.
New Technologies and Additional Information on Missile Defense, F35s
Lockheed has developed technology that enables F-22 pilots to “control a drone wingman” from their planes,” Taiclet noted. Additionally, the company conducted a successful test flight of its X-59 “quiet, subsonic aircraft,” the CEO reported. The X59 is supposed to “pave the way for faster commercial air travel, even over land,” he explained.
Finally, the company has developed “an autonomous Black Hawk” helicopter that can be controlled remotely. Utilizing AI, the technology “will enable critical missions such as contested logistics, air evacuation, and even wildfire fighting, without putting pilots and air crews at risk,” according to Taiclet. If the technology does indeed allow militaries and government civilian agencies to avoid putting lives at risk in so many situations, it should prove to be very valuable for Lockheed and is likely to be a major needle mover for LMT stock.
On the missile-defense front, Lockheed obtained a contract to provide 18 satellites, which will be used for tracking missiles, to the Space Development Agency. The deal could be worth as much as $1 billion. Further, the company obtained a deal to provide 31 interceptors for the THAAD missile-defense system. And as I pointed out in a previous column, the Pentagon asked the company to raise the production of its PAC-3 interceptors to 2,000 annually. Consequently, it’s very likely that the agency will buy all of the interceptors from Lockheed.
As far as the F35s are concerned, the company in Q4 obtained contracts worth more than $15 billion for the production and maintenance of the aircraft, Taiclet reported. Additionally, as I reported in the previous article, the company delivered 191 aircraft in 2025, representing a record and a large increase from the previous record of 142, set in 2021. .In 2024, the company delivered just 110 F35s.
LMT’s Valuation Is Favorable
LMT’s price-earnings ratio is just 21. Given the expected, strong increase of its profits this year and its powerful growth drivers, LMT is quite cheap.
*This article is intended to be informational only; it is not financial advice.
