Lockheed Martin Stock Dips As BofA Analyst Lowers EPS Estimates, Forecast After Air Force Contract Setback

Lockheed Martin Corporation LMT shares are trading lower on Monday after BofA Securities analyst Ronald J. Epstein downgraded the stock from Buy to Neutral and cut its price forecast from $685 to $485.

The analyst notes that on Friday, Lockheed Martin stocks took a hit after the White House and U.S. Air Force (USAF) selected Boeing over the company as the winner of the $20 billion contract for the Next Generation Air Dominance (NGAD) program, reported Reuters. This will replace Lockheed Martin's F-22 Raptor.

The analyst writes that he, along with most industry experts and investors, anticipated a much higher likelihood of Lockheed Martin securing the program.

While defense budgets are expected to increase, concerns remain regarding Lockheed Martin’s recent earnings quality, the loss of all six next-generation manned tactical aircraft programs and the absence of near-term company-specific catalysts, adds the analyst.

The analyst lowered adjusted EPS estimates to $27.15 (from $29.20 prior) in 2025, $29.15 (from $30.30 earlier) in 2026 and $31.05 (from $31.35) in 2027.

Epstein has also cited a downward revision in his topline growth expectations and delayed expectations related to the profitability ramp-up for the aeronautics business.

Investors can gain exposure to the stock via First Trust Exchange-Traded Fund First Trust Indxx Aerospace & Defense ETF MISL and Pacer Solactive Whitney Future of Warfare ETF FOWF.

LMT Price Action: Lockheed Martin shares are down 1.58% at $432.74 at publication Monday.

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