Lockheed Martin (LMT) Q3 2026: Revenue and Earnings Growth — Strong Performance: Gaps +5.1% at Open — Post-Earnings Analysis
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Lockheed Martin Corporation (NYSE: LMT) reported a robust third quarter for 2026, with sales increasing by $2.1 billion, or 11%, to reach $20.7 billion compared to $18.6 billion in the same quarter last year. Net earnings also saw a significant rise, climbing 14% to $1.8 billion, or $7.97 per share, up from $1.6 billion, or $6.95 per share in Q3 2025.
This quarter's performance is undoubtedly positive for shareholders, reflecting strong operational execution and demand for Lockheed Martin's defense technology solutions. The increase in both revenue and earnings per share indicates effective management and a solid market position, which should bolster investor confidence.
Key Financial Metrics
- Sales: $20.7 billion, up $2.1 billion or +11% YoY
- Net Earnings: $1.8 billion, up $226 million or +14% YoY
- Earnings Per Share (EPS): $7.97, up $1.02 or +15% YoY
- Cash from Operations: $3.4 billion, down $290 million YoY
- Free Cash Flow: $3.0 billion, down $348 million YoY
- Backlog: $292.0 billion, up 27% since Q2 2026
Lockheed Martin's ability to grow its backlog to a record $292.0 billion, including $52.5 billion related to the PAC-3 Missile Segment Enhancement interceptors, is particularly noteworthy. This backlog growth suggests a strong pipeline of future revenue, which is critical for sustaining long-term growth.
Dividend and Guidance Update
In a notable development, Lockheed Martin announced an increase in its dividend for the 24th consecutive year, reflecting its commitment to returning value to shareholders. The company also raised its financial outlook for 2026, now projecting:
- Sales: ~$80,000 - $82,000 million (previously $79,750 - $81,750 million)
- Diluted EPS: ~$30.35 - $30.75 (previously $29.95 - $30.65)
- Free Cash Flow: ~$7,800 - $8,000 million (previously $7,000 - $7,200 million)
This upward revision in guidance is a strong indicator of management's confidence in the company's operational capabilities and market conditions.
Segment Performance
Lockheed Martin's four business segments all reported year-over-year growth:
- Aeronautics: Sales increased 13% to $8.2 billion, with operating profit rising 9% to $743 million.
- Missiles and Fire Control: Sales surged 24% to $4.5 billion, with operating profit also up 24% to $631 million.
- Rotary and Mission Systems: Sales grew 3% to $4.5 billion, with operating profit increasing 4% to $524 million.
- Space: Sales rose 4% to $3.5 billion, with operating profit remaining stable at $331 million.
Each segment's growth underscores Lockheed Martin's diversified portfolio and its ability to capitalize on various defense contracts and technological advancements.
Forward Catalysts
Investors should closely monitor Lockheed Martin's negotiations with the U.S. Government regarding the production contracts for F-35 lots 20 and higher. The outcome of these negotiations could significantly impact future revenue and operational performance. Additionally, continued advancements in digital technologies and AI integration into defense systems will be crucial for maintaining competitive advantages in the market.
In conclusion, Lockheed Martin's third quarter results reflect a strong operational performance and a positive outlook for the remainder of 2026. The combination of revenue growth, increased earnings, and a record backlog positions the company favorably for future success, making it an attractive prospect for investors.
Note: The following tables are in millions.
Quarterly Earnings — Revenue vs. Estimate
| Quarter Label | Quarter End | Rev Actual ($M) | Rev Est ($M) | Rev Var ($M) | EPS Actual | EPS Est | EPS Beat |
|---|---|---|---|---|---|---|---|
| Q3 2026 | 2026-10 | — | 20,480 | — | 7.97 | 7.52 | +0.45 |
| Q2 2026 | 2026-06-30 | 20,060 | 19,340 | +720 | 7.94 | 7.22 | +0.72 |
| Q1 2026 | 2026-03-31 | 18,020 | 18,380 | -360 | 6.44 | 6.79 | -0.35 |
| Q4 2025 | 2025-12-31 | 20,320 | 19,840 | +480 | 5.80 | 6.33 | -0.53 |
| Q3 2025 | 2025-09-30 | 18,610 | 18,450 | +160 | 6.95 | 6.33 | +0.62 |
Revenue vs. Estimate — 5 Quarters
EPS vs. Estimate — 5 Quarters
Analyst Ratings & Price Targets
| Date | Status | Outer | Rating | Price |
|---|---|---|---|---|
| 2026-10-14 | Upgrade | Vertical Research | Hold → Buy | $600 |
| 2026-10-09 | Initiated | Barclays | Equal Weight | $554 |
| 2026-10-06 | Initiated | Rothschild & Co Redburn | Buy | $650 |
| 2026-09-08 | Upgrade | UBS | Neutral → Buy | $674 |
| 2026-07-01 | Upgrade | Citigroup | Neutral → Buy | $582 |
| 2026-05-18 | Reiterated | Bernstein | Mkt Perform | $661 → $614 |
| 2026-04-01 | Initiated | Wells Fargo | Equal Weight | $650 |
| 2026-02-03 | Downgrade | DZ Bank | Buy → Hold | $665 |
Lockheed Martin Corporation (LMT) has seen a series of positive analyst rating changes in recent months, reflecting growing optimism. Vertical Research upgraded LMT from Hold to Buy with a $600 price target on October 14, following UBS and Citigroup’s earlier upgrades from Neutral to Buy in September and July, respectively, with targets of $674 and $582. Barclays initiated coverage with an Equal Weight rating and a $554 target on October 9, while Rothschild & Co Redburn started coverage with a Buy recommendation and a $650 target on October 6. Bernstein reiterated its Market Perform rating on May 18 but adjusted its target down from $661 to $614. The consensus price target suggests modest upside potential from LMT’s current trading levels, with recent upgrades signaling increasing confidence in the defense contractor’s growth prospects amid strong defense spending trends.
Technical Analysis — 90-Day Price Chart
Lockheed Martin Corporation (LMT) trades at $582.41, well above its key moving averages—SMA20 ($522.86), SMA50 ($538.94), and SMA200 ($513.12)—confirming a strong bullish trend. The SMA20’s recent crossover above the SMA50 further reinforces upward momentum. However, the RSI(14) at 81.5 signals overbought conditions, suggesting potential near-term consolidation or pullback. Volume of 1.58M shares exceeds the 20-day average of 1.19M, indicating heightened investor interest at current levels. Positioned near the 52-week high ($608.98), LMT faces immediate resistance at that level, while support lies near the SMA20 and the 52-week low ($484.16). The stock’s proximity to all-time highs reflects sustained bullish sentiment, though overbought RSI and elevated volume warrant caution for a near-term correction.
