Why Lockheed Martin May Be an Underrated Stock to Buy Right Now
The defense and aerospace stock did well during the last market crash and can provide investors with tons of long-term stability and dividend income.
Lockheed Martin (LMT -0.07%) is emerging as an attractive investment option for those looking for a stable stock that can handle market fluctuations. Throughout 2022, the company outperformed the S&P 500, which saw a negative 18% return, while LMT's stock gained over 40%. This is due to Lockheed Martin's close ties with the U.S. government, which drives strong defense spending and makes the stock resilient to market downturns.
The company reported a 11% year-over-year revenue increase of $20.1 billion in its most recent quarterly results, ending June 28. Analysts expect continued growth, putting the stock at a forward price-to-earnings (P/E) ratio of 16, compared to the S&P 500's average of over 19. This makes Lockheed Martin an undervalued investment right now.
Moreover, the company offers a substantial dividend yield of 2.6%, which is considerably higher than the S&P 500's average of 1%. Lockheed Martin has also maintained a consistent dividend increase streak of 24 years, suggesting that there will likely be more dividend raises in the future. Considering its solid business, stability, and growth potential, Lockheed Martin appears to be an underrated stock worth investing in right now.
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