Lockheed Martin (LMT): Buy, Sell, or Hold Post Q1 Earnings?

Petr Huřťák Tue, July 14, 2026 at 11:35 AM EDT 3 min read **

• LMT
• ^GSPC

Lockheed Martin (LMT): Buy, Sell, or Hold Post Q1 Earnings? Over the past six months, Lockheed Martin's stock price fell to $522.25. Shareholders have lost 8.8% of their capital, which is disappointing considering the S&P 500 has climbed by 9.4%. This was partly due to its softer quarterly results and may have investors wondering how to approach the situation.

Is now the time to buy Lockheed Martin, or should you be careful about including it in your portfolio? Dive into our full research report to see our analyst team's opinion, it's free.

Why Do We Think Lockheed Martin Will Underperform?

Even though the stock has become cheaper, we're sitting this one out for now. Here are three reasons we avoid LMT, plus one stock we'd rather own.

1. Long-Term Revenue Growth Disappoints

A company's long-term sales performance can indicate its overall quality. Any business can have short-term success, but a top-tier one grows for years. Unfortunately, Lockheed Martin's 2.6% annualized revenue growth over the last five years was sluggish. This fell short of our benchmarks.

Lockheed Martin Quarterly Revenue

2. EPS Trending Down

We track the long-term change in earnings per share (EPS) because it highlights whether a company's growth is profitable.

Sadly for Lockheed Martin, its EPS declined by 3.7% annually over the last five years while its revenue grew by 2.6%. This tells us the company became less profitable on a per-share basis as it expanded.

Lockheed Martin Trailing 12-Month EPS (GAAP)

3. New Investments Fail to Bear Fruit as ROIC Declines

We like to invest in businesses with high returns, but the trend in a company's ROIC can also be an early indicator of future business quality.

Over the last few years, Lockheed Martin's ROIC has unfortunately decreased. We like what management has done in the past, but its declining returns are perhaps a symptom of fewer profitable growth opportunities.

Lockheed Martin Trailing 12-Month Return On Invested Capital

Final Judgment

Lockheed Martin falls short of our quality standards. Following the recent decline, the stock trades at 17.2× forward P/E (or $522.25 per share). While this valuation is reasonable, we don't see a big opportunity at the moment. There are superior stocks to buy right now. Let us point you toward the most entrenched endpoint security platform on the market.

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