Not Much Flash in Lockheed Martin Earnings
Lockheed Martin reported quarterly and full-year results this morning that met mostly profit expectations and exceeded revenue estimates. The outlook was a bit shaky, however.
This post may contain links from our sponsors and affiliates, and Flywheel Publishing may receive compensation for actions taken through them.
When Lockheed Martin Corp. (NYSE: LMT | LMT Price Prediction) reported fourth-quarter and full-year 2018 results before markets opened Tuesday morning, the world’s largest defense company posted diluted earnings per share (EPS) from continuing operations of $2.39 on revenues of $14.4 billion for the quarter. In the same period a year ago, the company reported a net loss of $85 per share on revenues of $13.8 billion. The net loss last year was the primarily due to the tax reform bill and was a non-cash loss. The latest quarterly results also compare to the consensus estimates for EPS of $4.40 and $13.75 billion in revenues.
For the full year, the company posted EPS of $17.59 on revenues of $53.8 billion, compared with year-ago EPS of $6.50 and revenues of $50 billion. Analysts were looking for EPS of $17.59 and revenues of $53.11 billion.
Cash flow from operations totaled $2.2 billion in the quarter, up from $1.5 billion in the fourth quarter of 2017. For the year, cash flow from operations totaled $3.1 billion after annual pension contributions of $5 billion. In 2017, cash flow totaled $6.5 billion with no pension contributions.
[nativounit]
CEO Marillyn Hewitt commented:
As we look ahead to 2019, we remain focused on performing with excellence for customers, and our record backlog and differentiating portfolio have us well-positioned for continued growth and long-term value creation for shareholders.
Lockheed’s outlook for 2019 calls for revenues in the range of $55.75 to $57.25 billion and diluted EPS of $19.15 to $19.45. Analysts had forecast EPS of $19.55 and revenues of $56.23 billion. The company forecasts cash flow from operations of at least $7.4 billion and a pension benefit of about $1.5 billion.
The company repurchased 4.7 million shares of its stock, valued at $1.8 billion, during 2018 and paid dividends totaling $2.2 billion.
Investors’ reaction to the report was positive if not enthusiastic. Quarterly earnings were only a penny short and full-year EPS came in as expected. Revenues beat expectations on both measures, but Lockheed’s EPS outlook was light, never a good signal to investors.
The somewhat mixed results have pushed the stock up about 1.5% in the late morning to $292.30, in a 52-week range of $241.18 to $363.00. The consensus 12-month price target on the stock is $343.37.
[recirclink id=524392]
[wallst_email_signup]
Contact [email protected] for any questions or corrections.
Paul Ausick has been writing for 247Wallst.com for more than a decade. He has written extensively on investing in the energy, defense, and technology sectors. In a previous life, he wrote technical documentation and managed a marketing communications group in Silicon Valley.
He has a bachelor's degree in English from the University of Chicago and now lives in Montana, where he fishes for trout in the summer and stays inside during the winter.
