Deutsche Bank Comments on Lockheed Martin's 3Q Earnings Ahead of 2pm Conference Call

Deutsche Bank has published a report on Lockheed Martin LMT after the company's 3Q earnings report and ahead of today's 2pm conference call. In the report, Deutsche Bank writes, "LMT reported 3Q underlying EPS of $2.06 (ex. 7c severance costs), well ahead of our/Street's estimates of $1.88/1.81. The beat was mostly driven by better sales performance, and slightly better EBIT margins. Sales of $12.1B were 3.6% higher than our forecast (and up 6.5% y/y), driven mostly by strong performance in Aeronautics. EBIT margins were down 50bps y/y but 60bps higher vs. our estimate. Book/bill of 0.65x was seasonally weak, driven by lower bookings in Space and Aeronautics. The company offered up an initial look into 2012, with sales and margins flat y/y, and pension expense of ~$925M, which is ~$200M worse than our forecast (which was already much worse than consensus)." Deutsche Bank maintains its Hold rating and $76 price target on Lockheed Martin, which is currently trading down $2.57 from yesterday's $78.89 closing price.