Will Lockheed Martin (LMT) Stock Be Affected By This NASA Contract Extension?

NEW YORK (TheStreet) --Lockheed Martin Corp. (LMT) announced today that it received a three year, $350 million contract extension in order to continue providing facilities, development, and operations support of human spaceflight missions at NASA's Johnson Space Center in Houston, TX.

The global security and aerospace company will continue to provide these services to NASA through September 2016, and the contract includes a two-year base period with a one year option.

The total value of the contract now exceeds $1 billion, the company said.

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Shares of Lockheed Martin are up 0.13% to $168.51 in mid-morning trading on Tuesday.

TheStreet Ratings team rates LOCKHEED MARTIN CORP as a Buy with a ratings score of A+. TheStreet Ratings Team has this to say about their recommendation:

"We rate LOCKHEED MARTIN CORP (LMT) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its solid stock price performance, good cash flow from operations, growth in earnings per share, increase in net income and notable return on equity. We feel these strengths outweigh the fact that the company has had generally high debt management risk by most measures that we evaluated."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • Investors have apparently begun to recognize positive factors similar to those we have mentioned in this report, including earnings growth. This has helped drive up the company's shares by a sharp 39.00% over the past year, a rise that has exceeded that of the S&P 500 Index. Regarding the stock's future course, although almost any stock can fall in a broad market decline, LMT should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
  • Net operating cash flow has significantly increased by 56.82% to $977.00 million when compared to the same quarter last year. In addition, LOCKHEED MARTIN CORP has also vastly surpassed the industry average cash flow growth rate of -24.85%.
  • LOCKHEED MARTIN CORP's earnings per share improvement from the most recent quarter was slightly positive. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, LOCKHEED MARTIN CORP increased its bottom line by earning $9.04 versus $8.34 in the prior year. This year, the market expects an improvement in earnings ($11.25 versus $9.04).
  • The net income growth from the same quarter one year ago has exceeded that of the S&P 500, but is less than that of the Aerospace & Defense industry average. The net income increased by 3.5% when compared to the same quarter one year prior, going from $859.00 million to $889.00 million.
  • LMT, with its decline in revenue, slightly underperformed the industry average of 0.8%. Since the same quarter one year prior, revenues slightly dropped by 0.9%. The declining revenue has not hurt the company's bottom line, with increasing earnings per share.
  • You can view the full analysis from the report here: LMT Ratings Report
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