Bank of America sends strong message on Lockheed Martin stock

Toward the extremity of the week that ended connected April 25, I covered a portion connected Lockheed Martin CEO Jim Taiclet, calling the existent defence situation a "golden opportunity," and a uncommon infinitesimal of unguarded enthusiasm from the person of the world's largest defence contractor. The market, apparently, needed much convincing.

Lockheed Martin (LMT) shares fell 4.6% aft its first-quarter 2026 net study connected Thursday, April 23, 2026, importantly underperforming the S&P 500, which declined conscionable 0.4% aforesaid day.

The concern wasn't broken. The full-year outlook was reaffirmed. But what the numbers revealed underneath the header figures gave investors pause, and Bank of America capable crushed to contented a pointed reset connected the stock.

BofA Global Research reiterated a Neutral standing connected LMT connected April 24, cutting its terms nonsubjective to $600 from $660. The slope didn't quality Taiclet's semipermanent vision.

No. It simply said the load of impervious present falls squarely connected the 2nd fractional of 2026. And that the way betwixt present and the munitions ramp-up everyone is waiting for isn't arsenic cleanable arsenic the bull lawsuit suggests.

Why Bank of America chopped its Lockheed Martin terms nonsubjective

BofA's enactment landed with a operation that frames the full thesis: "between a classified stone and a generational request opportunity."

That hostility is the bosom of the bank's Neutral stance. On 1 side, Lockheed Martin sits astatine the halfway of the astir important defence spending rhythm successful a generation.

Missiles, rocket defense, hypersonics, and classified programs, each seeing accelerating request driven by the Iran struggle and the Trump administration's grounds $1.5 trillion Pentagon fund request, according to the U.S. Department of Defense.

Related: Lockheed Martin CEO sends beardown 2-word connection connected Middle East

On the different side, the company's near-term fiscal visibility is being clouded by classified programme execution hazard and a currency travel illustration that BofA sees arsenic progressively pressured.

BofA lowered its terms nonsubjective to $600 from $660, based connected a 13x EV/EBITDA aggregate applied to its 2027 estimates. That equated to down from 14 times previously, according to BofA's probe note. The aggregate compression reflects little wide estimates, assemblage de-rating, and what the slope describes arsenic a deficiency of visibility connected classified programs, creating lumpiness betwixt present and the anticipated munitions ramp-up.

BofA's revised LMT banal estimates:

• 2026 EPS: $29.90 (down from $30.05)

• 2027 EPS: $33.15 (down from $33.50)

• 2028 EPS: $37.75 (down from $37.95)

• 2026 escaped currency flow: $6.49 cardinal (down from $6.70 billion)

• 2027 escaped currency flow: $7.44 cardinal (down from $8.08 billion)

• 2028 escaped currency flow: $7.47 cardinal (down from $7.80 billion)
  Source: Bank of America Global Research Report