LMT
Lockheed Martin
Dividend / Cash flow
★ Quality 65/100Price today
$517.20
what the market pays
Worth
$427.95
calculated cycle value
Price is 21% above its value
charlieapp.co
A monopoly position
This company has a competitive advantage so strong that its rivals find it practically impossible to replicate.
Price vs Intrinsic Value
The line is the price month by month; the green band marks when it's undervalued (−20% off value). When the price drops in there, the discount is real, not opinion.
Where does the value come from?
Established business paying dividends
$503.23
per share
How it's calculated
Lockheed Martin — high assistant lane (2026-06-07). Review note.
Net cash in the bank
cash minus financial debt, per share
Total calculated value
business + cash
How many times the cash flow
Dividend / Cash flow · vs 42 peers
You pay 20x times this business's cash flow; its sector median is 25.8x.
15% above what Charlie thinks it's worth (17x) — you're overpaying, sector or no sector.
Why Overvalued?
Its free cash flow is $29.58/share × 17.0x multiplier minus $75.28 in negative net cash = $427.95 in intrinsic value. Today's price of $517.20 is 17% above the calculated value — the market is paying a premium over what the model sees as fair.
The price is 21% above the calculated value. You're paying more than it's worth.
Buying here lowers your expected return and wipes out the safety margin.
The next reasonable entry zone starts at $406.55.
At what price would buying make sense?
Entry zones
🟢 Undervalued
≤$342.36
-20% off Value
🟡 Discounted
≤$406.55
-5% off Value
🔴 Today
$517.20
-17% Valor
Overvalued
The market prices it too high versus what the business makes. Patience pays off here.
“Time is the friend of the wonderful company, the enemy of the mediocre.”
— Warren Buffett
Model updated · July 2026
The business
Sells the fighter jet, but charges for parts and support for 40 years.
Lockheed Martin builds highly complex weaponry: the F-35 fighter jet, missiles, Sikorsky helicopters and space systems. Its main customer is the Pentagon, which pays for multi-year contracts. It brought in $75.0B in 2025, with the F-35 as its backbone.
Few companies in the world can build a fifth-generation fighter jet, and the U.S. government doesn't switch suppliers lightly. The barriers are decades of R&D, national security and brutal switching costs. Once a plane is in an allied fleet, the parts and support get charged for 40 years.
Revenue history
From $67.0B to $75.0B in 4 years. The business grows steadily.
Where each $100 of sales goes
Revenue $75.0B · FY2025
Of every $100 in sales, $93 goes to costs and operations; $7 is left as net profit (7% margin).
Catalysts and risks
U.S. defense budget tops $850B in FY2025, with upward pressure from geopolitics.
F-35 program: backlog that sustains production and maintenance well beyond 2040.
FCF of $6.9B funds buybacks and a dividend that LMT has raised every year for two decades.
Almost total dependence on a single customer: if Congress cuts, LMT feels it directly.
Gross margin of 10% — a fixed-cost contract business where a cost overrun eats your profit.
Debt of $21.7B against $4.1B in cash; little cushion if FCF stumbles.
Charlie's note
“A boring business that prints cash and pays a dividend because nobody else can do what it does. The 10% margin scares off the trigger-happy, but the Pentagon signs off on the moat here.”
Analysis · June 2026
So when would be a good price for Lockheed Martin?
By our calculation, not yet. We will email you the day it drops to $406.55 — so you do not have to keep checking.
🔔 Email meFree · no card
Charlie informs, it doesn't advise. No information should be taken as a recommendation to buy or sell.