Lockheed Martin is demonstrating operational strength across its key fighter jet programs, securing substantial new funding for its flagship F-35 while achieving a critical manufacturing milestone for its modernized F-16. This dual success underscores the defense contractor’s robust order book and production capabilities, even as its share price performance in the current year has lagged behind these fundamental developments.
Substantial F-35 Contract Adjustment
A significant contract modification, valued at approximately $1.14 billion, has been secured to fund materials for F-35 production lots 20 and 21. This investment solidifies the financial backbone for the continued manufacturing of the fifth-generation fighter, a cornerstone program for both the U.S. military and a coalition of international partners. Beyond the F-35, Lockheed is also expanding its precision fires revenue streams. A separate $52 million contract from the U.S. Department of Defense covers ongoing work on the HIMARS rocket system, a platform whose strategic value has been prominently demonstrated in recent global conflicts.
Modernized F-16 Fleet Rolls Out in South Carolina
Concurrently, the company has completed production of the first F-16 Block 70 fighter jets for NATO allies Bulgaria and Slovakia at its facility in Greenville, South Carolina. This delivery marks a pivotal achievement in the modernization of these allied nations’ air forces. The new Block 70 variant represents a technological leap for fourth-generation aircraft, integrating the advanced APG-83 AESA radar—which shares core technology with the F-35—and featuring a structural service life designed for 12,000 flight hours, thereby offering extended operational capability.
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The successful completion also validates the efficiency of the world’s only active F-16 production line. It serves as a testament to Lockheed Martin’s ability to manage a complex international supply chain involving over 530 suppliers, sending a strong signal to other potential customers in the current geopolitical environment.
Market Analysts Identify Upside Potential
Financial analysts are taking note of these operational achievements. While Wall Street Zen recently slightly adjusted its rating from “Strong Buy” to “Buy,” the broader market consensus continues to hold a price target around $510. Given a recent closing price of €412.00 and a year-to-date decline of roughly 12%, this implies significant potential for share price recovery if the market begins to more fully reward the company’s operational progress.
With the initial F-16 orders now fulfilled, focus shifts to the seamless delivery and integration of these aircraft with the receiving nations. This successful execution establishes a valuable reference case for potential follow-on orders from other allies seeking to upgrade their aging fleets, providing Lockheed with a steady revenue stream independent of its flagship F-35 program.
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