Is Lockheed Martin Stock a Buy?

The leaders of large nations (the U.S., for example) generally feel that there is a need to support a strong military and the industries that supply that military. The dollars directed toward the defense industry do wax and wane a bit with changing political and world environments, but companies like Lockheed Martin (NYSE: LMT) have basically become necessity businesses in the military-industrial complex.

But that government support doesn't mean Lockheed Martin stock is always worth buying. It's important to take into account both the business it is pursuing and the current stock valuation before deciding to step aboard. Here's a quick look at this defense industry giant.

Before getting into what makes Lockheed Martin tick, let's look at a few stock valuation metrics. The price-to-sales ratio works well because defense industry sales tend to be more consistent over time than earnings, which can vary dramatically from year to year. Lockheed's price-to-sales ratio is currently at 1.6. Taken alone that figure is not so interesting, but when compared to the company's five-year P/S average of 1.7 times, you see that the company looks at least a bit cheaper than usual.

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Source Fool.com