We use cookies to understand how you use our site and to improve your experience.
This includes personalizing content and advertising.
By pressing "Accept All" or closing out of this banner, you consent to the use of all cookies and similar technologies and the sharing of information they collect with third parties.
You can reject marketing cookies by pressing "Deny Optional," but we still use essential, performance, and functional cookies.
In addition, whether you "Accept All," Deny Optional," click the X or otherwise continue to use the site, you accept our Privacy Policy and Terms of Service, revised from time to time.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Will Budget Slash Cut Lockheed's Nuclear Space Propulsion Flight Short?
Read MoreHide Full Article
Key Takeaways
U.S. budget cuts canceled LMT's DARPA-backed DRACO nuclear space propulsion project.
Lockheed remains active in NEP development via the Air Force's JETSON program for deep-space missions.
LMT trades at an 18.9% discount to peers and has mixed EPS estimate trends for 2025 and 2026.
Space agencies across the globe are actively investing in the development of nuclear thermal propulsion (NTP) rockets for future space exploration missions, considering NTP’s advantages over traditional chemical rockets in terms of efficiency and travel times. With NASA being a prominent organization on the global space map, U.S.-based Lockheed Martin Corp. (LMT - Free Report) is witnessing increasing traction due to its proven mission-integrated space capabilities.
Notably, in 2023, the United States’ Defense Advanced Research Projects Agency (“DARPA”) selected Lockheed to develop and demonstrate a nuclear-powered spacecraft under a project named Demonstration Rocket for Agile Cislunar Operations (“DRACO”).
However, last month, unfortunate news surfaced that the DRACO project might not see the daylight following U.S. President Trump’s budget cuts for some major space missions. The cancellation of DRACO was first reported in early June by Ars Technica in an analysis of NASA’s fiscal 2026 budget request that included no funding for the project. While this comes as a major blow for Lockheed, considering its deep involvement in NASA’s NTP programs, not all seems lost for the stock.
After all, this U.S.-based defense contractor has been a key contributor to major space programs designed by NASA, including those involving nuclear technologies.
Apart from NTP, Lockheed is engaged in designing a nuclear electrical propulsion (NEP) system for a spacecraft as part of the U.S. Air Force Research Laboratory’s Joint Emergent Technology Supplying On-Orbit Nuclear (“JETSON”) program. JETSON will serve as a critical step forward in using NEP to get humans to the Moon, Mars and beyond.
While the current U.S. administration’s budget cuts remain a cause of concern, Lockheed’s well-established prominence in the space economy across diverse operations, ranging from deploying satellites to designing spacecraft, should help it fly high in Space as long as NASA continues to explore and research it.
Other Stocks Warranting a Look
Investors interested in other defense stocks that are involved in the space economy, particularly those focused on nuclear space technologies, can consider BWX Technologies (BWXT - Free Report) and Boeing (BA - Free Report) .
Notably, BWX Technologies has been involved with NASA and the Department of Energy’s groundbreaking NTP design since 2017, focusing on fuel design and engineering, and work associated with it. To further develop its research and development work in nuclear technologies, BWXT opened its Innovation Campus, a 170,000 square-foot facility that focuses on nuclear technology advancements for land, sea and space, in April this year.
On the other hand, Boeing is another prominent space stock, which is a key contractor in the Space Launch System program, designed to carry astronauts farther into space than ever before. It is also involved in nuclear-related space activities through its work on the U.S. Space Force's Evolved Strategic Satellite program, designed to provide secure and jam-resistant communications for strategic missions.
The Zacks Rundown for LMT
Shares of Lockheed have risen 0.6% in the past year compared with the industry’s growth of 18.7%.
Image Source: Zacks Investment Research
From a valuation standpoint, LMT is currently trading at a forward 12-month sales of 1.43X, a roughly 35.9% discount when stacked up with the industry average of 2.23X.
Image Source: Zacks Investment Research
The near-term estimates for LMT’s earnings per share (EPS) have moved south over the past 60 days.
Image Source: Zacks Investment Research
Lockheed currently carries a Zacks Rank #4 (Sell).
Image: Bigstock
Will Budget Slash Cut Lockheed's Nuclear Space Propulsion Flight Short?
Key Takeaways
Space agencies across the globe are actively investing in the development of nuclear thermal propulsion (NTP) rockets for future space exploration missions, considering NTP’s advantages over traditional chemical rockets in terms of efficiency and travel times. With NASA being a prominent organization on the global space map, U.S.-based Lockheed Martin Corp. (LMT - Free Report) is witnessing increasing traction due to its proven mission-integrated space capabilities.
Notably, in 2023, the United States’ Defense Advanced Research Projects Agency (“DARPA”) selected Lockheed to develop and demonstrate a nuclear-powered spacecraft under a project named Demonstration Rocket for Agile Cislunar Operations (“DRACO”).
However, last month, unfortunate news surfaced that the DRACO project might not see the daylight following U.S. President Trump’s budget cuts for some major space missions. The cancellation of DRACO was first reported in early June by Ars Technica in an analysis of NASA’s fiscal 2026 budget request that included no funding for the project. While this comes as a major blow for Lockheed, considering its deep involvement in NASA’s NTP programs, not all seems lost for the stock.
After all, this U.S.-based defense contractor has been a key contributor to major space programs designed by NASA, including those involving nuclear technologies.
Apart from NTP, Lockheed is engaged in designing a nuclear electrical propulsion (NEP) system for a spacecraft as part of the U.S. Air Force Research Laboratory’s Joint Emergent Technology Supplying On-Orbit Nuclear (“JETSON”) program. JETSON will serve as a critical step forward in using NEP to get humans to the Moon, Mars and beyond.
While the current U.S. administration’s budget cuts remain a cause of concern, Lockheed’s well-established prominence in the space economy across diverse operations, ranging from deploying satellites to designing spacecraft, should help it fly high in Space as long as NASA continues to explore and research it.
Other Stocks Warranting a Look
Investors interested in other defense stocks that are involved in the space economy, particularly those focused on nuclear space technologies, can consider BWX Technologies (BWXT - Free Report) and Boeing (BA - Free Report) .
Notably, BWX Technologies has been involved with NASA and the Department of Energy’s groundbreaking NTP design since 2017, focusing on fuel design and engineering, and work associated with it. To further develop its research and development work in nuclear technologies, BWXT opened its Innovation Campus, a 170,000 square-foot facility that focuses on nuclear technology advancements for land, sea and space, in April this year.
On the other hand, Boeing is another prominent space stock, which is a key contractor in the Space Launch System program, designed to carry astronauts farther into space than ever before. It is also involved in nuclear-related space activities through its work on the U.S. Space Force's Evolved Strategic Satellite program, designed to provide secure and jam-resistant communications for strategic missions.
The Zacks Rundown for LMT
Shares of Lockheed have risen 0.6% in the past year compared with the industry’s growth of 18.7%.
Image Source: Zacks Investment Research
From a valuation standpoint, LMT is currently trading at a forward 12-month sales of 1.43X, a roughly 35.9% discount when stacked up with the industry average of 2.23X.
Image Source: Zacks Investment Research
The near-term estimates for LMT’s earnings per share (EPS) have moved south over the past 60 days.
Image Source: Zacks Investment Research
Lockheed currently carries a Zacks Rank #4 (Sell).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.