Military
Lockheed Martin's Q2 Earnings Boosted by Federal Government Policies
Published:
Lockheed Martin Corp. (NYSE: LMT) reported second-quarter results before markets opened Tuesday. The country’s largest defense contractor reported earnings per share (EPS) of $5.79 on sales of $16.2 billion. In the year-ago quarter, Lockheed reported EPS of $5.00 and sales of $14.43 billion. Analysts had forecast EPS of $5.72 and sales of $15.23 billion for the quarter.
After outlining the “challenges” caused by the COVID-19 pandemic on the company’s business, Lockheed commented that “favorable contract award timing and strong performance more than offset the impacts of COVID-19 on the corporation’s financial results in the first half of 2020.”
Operating cash flow in the second quarter includes an accelerated payment of $930 million from the U.S. government, the deferral of $400 million in estimated federal tax payments until the third quarter and a $160 million in deferred payroll taxes for 2021 and 2022.
Cash from operations rose from $1.67 billion in 2019 to $2.18 billion in the quarter, and for the first half of the year, operating cash flow rose from $3.33 billion a year ago to $4.50 billion.
In its financial outlook for the year, Lockheed raised sales guidance from a prior range of $62.25 billion to $64 billion to a new range of $63.50 billion to $65.00 billion. Operating profit guidance rose from $6.80 billion to $6.95 billion to a new range of $6.90 billion to $7.05 billion. Diluted EPS guidance was lifted by a dime at both ends to a new range of $23.75 to $24.05, and estimated cash flow from operations rose from a previous estimate of at least $7.6 billion to at least $8 billion.
Analysts have forecast third-quarter EPS of $6.13 on sales of $16.01 billion. For the full year, consensus estimates call for EPS of $24.17 and sales of $63.45 billion.
Lockheed reported cash and equivalents totaling $2.9 billion, nearly double the company’s cash position at the end of December 2019. Total debt is essentially unchanged at $12.67 billion, but the company extended maturities on roughly $1.25 billion of previously current debt.
The company paid $671 million dividends in the quarter and repurchased 700,000 shares of stock for $259 million.
Lockheed stock traded up about 3.6% in Tuesday’s premarket, at $379.00 in a 52-week range of $266.11 to $442.53. The consensus 12-month price target on the stock is $432.72. Lockheed pays a dividend yield of 2.63% ($9.60 annualized).
24/7 Wall St.Get Ready To Retire (Sponsored)
Start by taking a quick retirement quiz from SmartAsset that will match you with up to 3 financial advisors that serve your area and beyond in 5 minutes, or less.
Each advisor has been vetted by SmartAsset and is held to a fiduciary standard to act in your best interests.
Here’s how it works:
1. Answer SmartAsset advisor match quiz
2. Review your pre-screened matches at your leisure. Check out the advisors’ profiles.
3. Speak with advisors at no cost to you. Have an introductory call on the phone or introduction in person and choose whom to work with in the future
Get started right here.
Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.