Did You See These 2 Key Earnings Reports Drop Today?

Two of America’s premier defense companies are set to report earnings today — Lockheed Martin (NYSE: LMT) and RTX Corp. (NYSE: RTX).

Both of these stocks have performed well over the past year. RTX stock is up about 40% over the past 12 months, while LMT has posted a more modest 17% gain (though LMT stock was up as much as 43% in November before falling off to end the year). 

Their fourth-quarter and full-year earnings ought to reflect that. 

Now they’ll look to build on that momentum in 2025, and we’ve got some encouraging signs early on that they’ll do just that.

Earnings Preview: Lockheed Martin (NYSE: LMT)

As America’s biggest defense contractor, Lockheed Martin has a lot of irons in the fire. But the company’s F-35 program is by far its most important, accounting for roughly 30% of its revenue.

Naturally, a program this sophisticated and expansive is destined to hit its share of snags, and the Joint Strike Fighter has done just that. 

Technology and software upgrades led to several delays and a temporary freeze on deliveries at the start of 2024, but the Pentagon resumed taking deliveries last July.

With that, Lockheed Martin delivered 132 F-35s last year, exceeding the top end of the production target range (75–110) set by management. 

Better still, the U.S. Navy just awarded Lockheed Martin a modification contract for 145 F-35 fighter jets that could potentially be worth nearly $12 billion.

The modification award has an expected completion date of June 2027 and is reportedly connected to a 2022 contract worth $13.2 billion that is roughly 51% complete.

That contract included 48 jets for the Air Force, 21 for the Marine Corps, and 14 for the Navy. It also earmarked 39 jets for foreign allies.

This is big money we’re talking about, so the fact that the F-35 program is back on track bodes well for LMT’s 2025.

Analysts expect LMT to report annual EPS of $26.79, down 3.7% from $27.82 in fiscal 2023. However, earnings are expected to rise 4.6% in 2025 to $28.03.

Earnings Preview: RTX Corp. (NYSE: RTX)

Lockheed Martin has another major moneymaker on its hands in the form of the Javelin anti-tank system, which it co-manufactures with RTX.

The Javelin has really made a name for itself in Ukraine, making it one of most desired munitions on the planet, with more than two dozen international customers.

It’s no surprise then that the U.S. Army just awarded the Javelin Joint Venture (JJV) a follow-on fiscal year 2024 production contract totaling $1.3 billion. 

That makes it the largest single-year Javelin production contract on record. It’s also the first follow-on award that’s a part of an indefinite-delivery, indefinite-quantity (IDIQ) production contract that was initially awarded in May 2023.

In addition to backfilling U.S. stockpiles, the contract includes more than 4,000 Javelins to replenish rounds sent to Ukraine.

Lockheed Martin and RTX have been scrambling to boost production to keep pace with this demand, with a goal of producing 3,960 units annually by late 2026.

RTX was also recently awarded a smaller, $282 million contract for its StormBreaker glide bombs. 

The munitions use GPS, radar, infrared, and laser guidance to track targets through darkness, rain, fog, smoke, dust, or any other obfuscation. Hence the name StormBreaker.

There’s another Lockheed Martin tie-in here, too, as the F-35 can carry as many as 16 of the smart bombs.

Finally, RTX scored another major win with a $946 million contract to supply the Patriot air and missile defense system to Romania.

That contract includes launchers, as well as radars, control stations, and missiles.

Romania, of course, is a former Soviet satellite state that neighbors Ukraine — if you were wondering why they’d be interested in air defense.

Nevertheless, the Patriot remains one of the most renowned and widely deployed anti-air defense systems on the planet, active in 19 countries.

And, as I’ve taken great pains to point out, this is a durable trend.

President Trump is pro-defense and has taken a very aggressive position toward Europe in that he wants them to spend more on weapons — particularly those made in the United States by the likes of Lockheed Martin and RTX. 

Furthermore, as fortune would have it, Europe hasn’t needed much prodding to ramp up its defense spend because Russia’s invasion of Ukraine has already well convinced them to do that. 

These are the mega-factors that will continue to drive earnings at Lockheed Martin and RTX. We should see that clearly in today’s reports. 

Wall Street is looking for a 3% revenue increase for RTX’s latest quarter and adjusted earnings of $1.38 per share.