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Lockheed Boosts Shareholder Value With Buyback & 5% Dividend Hike
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Key Takeaways
Lockheed Martin raised its quarterly dividend 5% to $3.45 per share, marking 23 straight annual hikes.
The board approved an extra $2B in share repurchases, lifting total authorization to nearly $9.1B.
A $166.5B backlog and strong defense orders support LMT's ability to sustain dividend growth.
Lockheed Martin Corp. (LMT - Free Report) announced that its board of directors approved a 5% hike in its quarterly dividend to $3.45 per share, marking the 23rd consecutive annual dividend hike. The revised quarterly dividend is payable on Dec. 30, 2025 to shareholders of record at the close of business on Dec. 1, 2025.
Following this hike, LMT’s new annualized dividend rate is $13.80 per share, resulting in an annualized dividend yield of 2.72%, which is better than the S&P 500 composite’s average of 1.48%.
Along with dividend payments, Lockheed’s management continues to increase shareholder value by repurchasing shares. The board authorized an additional $2 billion for share repurchases, which resulted in a total authorization of $9.1 billion under the repurchase program.
Can Lockheed Maintain Its Dividend Hike Streak?
Lockheed maintains a strong platform-centric approach and a well-established presence across the U.S. Army, Air Force, Navy and Department of Defense IT programs, ensuring a consistent stream of follow-on orders. The company continues to secure major defense contracts from both the U.S. government and allied nations. Beyond its robust domestic orders, Lockheed also benefits from a broad international customer base, with international sales accounting for 27.1% of total net sales in the second quarter of 2025.
A strong U.S. defense budget continues to serve as a major growth catalyst for Lockheed Martin. A White House report released in May 2025 indicated that President Trump proposed a 13% increase in the national defense budget, bringing it to $1.01 trillion for fiscal 2026. Such a substantial rise in defense spending is expected to drive significant order volumes for LMT’s defense products, strengthening its backlog and enhancing future revenue prospects. As of June 29, 2025, the company reported a robust backlog of $166.5 billion.
A solid cash distribution strategy typically reflects a company’s consistent ability to generate stable operating cash flows from its operations. In the first six months of 2025, LMT produced $1.61 billion in cash flow from operating activities, which is likely to have supported its decision to approve the recent dividend increase.
As of June 29, 2025, LMT held $1.29 billion in cash and cash equivalents. The company also reported a nearly 2.3% year-over-year increase in sales in the first half of 2025. Such a strong cash position, coupled with steady sales growth, is likely to enable LMT to continue to reward its shareholders with valuable dividend hikes.
Other Defense Companies’ Recent Dividend Hikes
Here are some defense companies that have been rewarding shareholders with impressive dividend payouts.
Northrop Grumman Corp. (NOC - Free Report) : In May 2025, the company announced that its board of directors approved a 12% increase in the quarterly dividend rate. Its revised quarterly dividend is now $2.31 per share.
NOC boasts a long-term (three to five years) earnings growth rate of 3.9%. The Zacks Consensus Estimate for 2025 sales stands at $42.16 billion, which calls for an increase of 2.7%.
General Dynamics Corp. (GD - Free Report) : In March 2025, the company announced that its board of directors had approved a 5.6% increase in the quarterly dividend rate. Its revised quarterly dividend will be $1.50 per share.
GD boasts a long-term earnings growth rate of 10.7%. The Zacks Consensus Estimate for 2025 sales is pinned at $51.18 billion, indicating year-over-year growth of 7.3%
L3Harris Technologies, Inc. (LHX - Free Report) : In February 2025, the company announced that its board of directors had approved a 3.4% increase in the quarterly dividend rate. Its revised quarterly dividend is now $1.20 per share.
LHX has a long-term earnings growth rate of 13%. The Zacks Consensus Estimate for 2025 sales stands at $21.75 billion, which suggests an increase of 2%.
LMT Stock Price Movement
In the past month, shares of LMT have climbed 7.9% compared with the industry’s rise of 2.7%.
Image: Bigstock
Lockheed Boosts Shareholder Value With Buyback & 5% Dividend Hike
Key Takeaways
Lockheed Martin Corp. (LMT - Free Report) announced that its board of directors approved a 5% hike in its quarterly dividend to $3.45 per share, marking the 23rd consecutive annual dividend hike. The revised quarterly dividend is payable on Dec. 30, 2025 to shareholders of record at the close of business on Dec. 1, 2025.
Following this hike, LMT’s new annualized dividend rate is $13.80 per share, resulting in an annualized dividend yield of 2.72%, which is better than the S&P 500 composite’s average of 1.48%.
Along with dividend payments, Lockheed’s management continues to increase shareholder value by repurchasing shares. The board authorized an additional $2 billion for share repurchases, which resulted in a total authorization of $9.1 billion under the repurchase program.
Can Lockheed Maintain Its Dividend Hike Streak?
Lockheed maintains a strong platform-centric approach and a well-established presence across the U.S. Army, Air Force, Navy and Department of Defense IT programs, ensuring a consistent stream of follow-on orders. The company continues to secure major defense contracts from both the U.S. government and allied nations. Beyond its robust domestic orders, Lockheed also benefits from a broad international customer base, with international sales accounting for 27.1% of total net sales in the second quarter of 2025.
A strong U.S. defense budget continues to serve as a major growth catalyst for Lockheed Martin. A White House report released in May 2025 indicated that President Trump proposed a 13% increase in the national defense budget, bringing it to $1.01 trillion for fiscal 2026. Such a substantial rise in defense spending is expected to drive significant order volumes for LMT’s defense products, strengthening its backlog and enhancing future revenue prospects. As of June 29, 2025, the company reported a robust backlog of $166.5 billion.
A solid cash distribution strategy typically reflects a company’s consistent ability to generate stable operating cash flows from its operations. In the first six months of 2025, LMT produced $1.61 billion in cash flow from operating activities, which is likely to have supported its decision to approve the recent dividend increase.
As of June 29, 2025, LMT held $1.29 billion in cash and cash equivalents. The company also reported a nearly 2.3% year-over-year increase in sales in the first half of 2025. Such a strong cash position, coupled with steady sales growth, is likely to enable LMT to continue to reward its shareholders with valuable dividend hikes.
Other Defense Companies’ Recent Dividend Hikes
Here are some defense companies that have been rewarding shareholders with impressive dividend payouts.
Northrop Grumman Corp. (NOC - Free Report) : In May 2025, the company announced that its board of directors approved a 12% increase in the quarterly dividend rate. Its revised quarterly dividend is now $2.31 per share.
NOC boasts a long-term (three to five years) earnings growth rate of 3.9%. The Zacks Consensus Estimate for 2025 sales stands at $42.16 billion, which calls for an increase of 2.7%.
General Dynamics Corp. (GD - Free Report) : In March 2025, the company announced that its board of directors had approved a 5.6% increase in the quarterly dividend rate. Its revised quarterly dividend will be $1.50 per share.
GD boasts a long-term earnings growth rate of 10.7%. The Zacks Consensus Estimate for 2025 sales is pinned at $51.18 billion, indicating year-over-year growth of 7.3%
L3Harris Technologies, Inc. (LHX - Free Report) : In February 2025, the company announced that its board of directors had approved a 3.4% increase in the quarterly dividend rate. Its revised quarterly dividend is now $1.20 per share.
LHX has a long-term earnings growth rate of 13%. The Zacks Consensus Estimate for 2025 sales stands at $21.75 billion, which suggests an increase of 2%.
LMT Stock Price Movement
In the past month, shares of LMT have climbed 7.9% compared with the industry’s rise of 2.7%.
Image Source: Zacks Investment Research
LMT’s Zacks Rank
Lockheed Martin currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.