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Will Segmental Performance Aid Lockheed's (LMT) Q3 Earnings?
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Lockheed Martin Corporation (LMT - Free Report) is slated to release third-quarter 2023 results on Oct 17, before the opening bell.
The company delivered an average earnings surprise of 5.04% in the last four quarters. Higher sales volume from three major segments, along with a lower share count, is likely to have benefited LMT’s third-quarter performance.
Let's see how things might have shaped up prior to the announcement.
Aeronautics to Post Dismal Sales
The Aeronautics segment, which primarily manufactures advanced, combat-proven jets, and contributes almost 40% to the company’s top line, is likely to deliver unimpressive results in the to-be-reported quarter.
Lockheed Martin Corporation Price and EPS Surprise
Higher production and sustainment volumes for the F-16 and classified programs are expected to have boosted the segment’s performance. However, unfavorable F-35 deliveries due to software maturation with the Tech Refresh 3 program and hardware delivery timing might have impacted this business unit’s overall sales.
The Zacks Consensus Estimate for the Aeronautics unit’s third-quarter revenues is pegged at $6,732 million, indicating a 5% decline from the prior-year period’s reported figure.
Other Segments to Shine
The remaining three segments are projected to have performed favorably in the third quarter.
Higher development volume from the next-generation interceptor as well as the classified program is expected to have benefited the Space business segment’s third-quarter performance. Favorable program lifecycle timing on Orion spacecraft might have also aided this unit’s sales growth.
The Zacks Consensus Estimate for the segment’s revenues is pinned at $3,084 million, indicating 7% growth from the prior-year quarter’s reported number.
Lockheed’s Missiles and Fire Control (MFC) segment provides critical missile defense support to the United States and foreign allies. Within this unit, higher sales volume from tactical and strike missiles is likely to have outweighed lower volume from integrated air and missile defense.
The Zacks Consensus Estimate for MFC’s third-quarter revenues is currently pegged at $2,920 million, indicating a 3.1% improvement from the year-ago quarter’s reported figure.
Higher sales volume from integrated warfare systems and sensors programs might have bolstered the Rotary and Mission Systems (RMS) segment’s sales in the to-be-reported quarter.
The Zacks Consensus Estimate for the RMS segment’s third-quarter revenues is currently pegged at $4,014 million, indicating a 6.2% improvement from that registered in the prior-year quarter.
Impressive Delivery Projections
For manufacturing companies like Lockheed, successful delivery of its manufactured goods indicates solid revenue generation. To this end, we notice that our forecast estimates LMT to have delivered 58 jets in the third quarter, which indicates year-over-year growth of 6.5%.
Q3 Expectations
The anticipated sales improvement in LMT’s three major segments is likely to have outweighed the sales deterioration from the Aeronautics segment. This, along with solid delivery projections, is expected to have boosted Lockheed’s overall sales performance.
The Zacks Consensus Estimate for the company’s third-quarter revenues is pegged at $16.66 billion, indicating a 0.5% increase from the year-ago quarter’s reported number.
Such a solid top-line performance, along with lower share count projections as well as tax benefits, is expected to have contributed favorably to LMT’s earnings.
The Zacks Consensus Estimate for the defense giant’s third-quarter earnings is pinned at $6.66 per share.
What the Zacks Model Unveils
Our proven model predicts an earnings beat for Lockheed this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. This is the case here as you will see below.
LMT has an Earnings ESP of +0.15% and a Zacks Rank #3. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Other Stocks to Consider
Below are three defense stocks that have the right combination of elements to post an earnings beat this time around.
General Dynamics delivered a four-quarter average earnings surprise of 2.99%. The consensus estimate for earnings is pegged at $2.86 per share, while that for sales is pinned at $9.89 billion.
L3Harris Technologies (LHX - Free Report) is scheduled to release third-quarter results on Oct 26. LHX has an Earnings ESP of +0.99% and a Zacks Rank #2.
L3Harris delivered a four-quarter average negative earnings surprise of 0.67%. The Zacks Consensus Estimate for LHX’s earnings is pegged at $3.07 per share, while that for sales is pinned at $4.78 billion.
RTX Corporation (RTX - Free Report) is expected to report third-quarter results on Oct 24. RTX has an Earnings ESP of +0.20% and a Zacks Rank #3.
RTX delivered a four-quarter average earnings surprise of 7.90%. The consensus mark for RTX’s earnings is pegged at $1.19 per share, while that for sales is pinned at $18.71 billion.
Image: Bigstock
Will Segmental Performance Aid Lockheed's (LMT) Q3 Earnings?
Lockheed Martin Corporation (LMT - Free Report) is slated to release third-quarter 2023 results on Oct 17, before the opening bell.
The company delivered an average earnings surprise of 5.04% in the last four quarters. Higher sales volume from three major segments, along with a lower share count, is likely to have benefited LMT’s third-quarter performance.
Let's see how things might have shaped up prior to the announcement.
Aeronautics to Post Dismal Sales
The Aeronautics segment, which primarily manufactures advanced, combat-proven jets, and contributes almost 40% to the company’s top line, is likely to deliver unimpressive results in the to-be-reported quarter.
Lockheed Martin Corporation Price and EPS Surprise
Lockheed Martin Corporation price-eps-surprise | Lockheed Martin Corporation Quote
Higher production and sustainment volumes for the F-16 and classified programs are expected to have boosted the segment’s performance. However, unfavorable F-35 deliveries due to software maturation with the Tech Refresh 3 program and hardware delivery timing might have impacted this business unit’s overall sales.
The Zacks Consensus Estimate for the Aeronautics unit’s third-quarter revenues is pegged at $6,732 million, indicating a 5% decline from the prior-year period’s reported figure.
Other Segments to Shine
The remaining three segments are projected to have performed favorably in the third quarter.
Higher development volume from the next-generation interceptor as well as the classified program is expected to have benefited the Space business segment’s third-quarter performance. Favorable program lifecycle timing on Orion spacecraft might have also aided this unit’s sales growth.
The Zacks Consensus Estimate for the segment’s revenues is pinned at $3,084 million, indicating 7% growth from the prior-year quarter’s reported number.
Lockheed’s Missiles and Fire Control (MFC) segment provides critical missile defense support to the United States and foreign allies. Within this unit, higher sales volume from tactical and strike missiles is likely to have outweighed lower volume from integrated air and missile defense.
The Zacks Consensus Estimate for MFC’s third-quarter revenues is currently pegged at $2,920 million, indicating a 3.1% improvement from the year-ago quarter’s reported figure.
Higher sales volume from integrated warfare systems and sensors programs might have bolstered the Rotary and Mission Systems (RMS) segment’s sales in the to-be-reported quarter.
The Zacks Consensus Estimate for the RMS segment’s third-quarter revenues is currently pegged at $4,014 million, indicating a 6.2% improvement from that registered in the prior-year quarter.
Impressive Delivery Projections
For manufacturing companies like Lockheed, successful delivery of its manufactured goods indicates solid revenue generation. To this end, we notice that our forecast estimates LMT to have delivered 58 jets in the third quarter, which indicates year-over-year growth of 6.5%.
Q3 Expectations
The anticipated sales improvement in LMT’s three major segments is likely to have outweighed the sales deterioration from the Aeronautics segment. This, along with solid delivery projections, is expected to have boosted Lockheed’s overall sales performance.
The Zacks Consensus Estimate for the company’s third-quarter revenues is pegged at $16.66 billion, indicating a 0.5% increase from the year-ago quarter’s reported number.
Such a solid top-line performance, along with lower share count projections as well as tax benefits, is expected to have contributed favorably to LMT’s earnings.
The Zacks Consensus Estimate for the defense giant’s third-quarter earnings is pinned at $6.66 per share.
What the Zacks Model Unveils
Our proven model predicts an earnings beat for Lockheed this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. This is the case here as you will see below.
LMT has an Earnings ESP of +0.15% and a Zacks Rank #3. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Other Stocks to Consider
Below are three defense stocks that have the right combination of elements to post an earnings beat this time around.
General Dynamics (GD - Free Report) is expected to release third-quarter results on Oct 25. GD has an Earnings ESP of +0.70% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
General Dynamics delivered a four-quarter average earnings surprise of 2.99%. The consensus estimate for earnings is pegged at $2.86 per share, while that for sales is pinned at $9.89 billion.
L3Harris Technologies (LHX - Free Report) is scheduled to release third-quarter results on Oct 26. LHX has an Earnings ESP of +0.99% and a Zacks Rank #2.
L3Harris delivered a four-quarter average negative earnings surprise of 0.67%. The Zacks Consensus Estimate for LHX’s earnings is pegged at $3.07 per share, while that for sales is pinned at $4.78 billion.
RTX Corporation (RTX - Free Report) is expected to report third-quarter results on Oct 24. RTX has an Earnings ESP of +0.20% and a Zacks Rank #3.
RTX delivered a four-quarter average earnings surprise of 7.90%. The consensus mark for RTX’s earnings is pegged at $1.19 per share, while that for sales is pinned at $18.71 billion.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.