Guided Missiles & Space Vehicles & Parts
Lockheed Martin Corporation, a security and aerospace company, engages in the research, design, development, manufacture, integration, and sustainment of technology systems, products, and services worldwide. It operates through four segments: Aeronautics, Missiles and Fire Control, Rotary and Mission Systems, and Space. The Aeronautics segment offers combat and air mobility aircraft, unmanned air vehicles, and related technologies. The Missiles and Fire Control segment provides air and missile defense systems; tactical missiles and air-to-ground precision strike weapon systems; logistics; fire control systems; mission operations support, readiness, engineering support, and integration services; manned and unmanned ground vehicles; and energy management solutions. The Rotary and Mission Systems segment offers military and commercial helicopters, surface ships, sea and land-based missile defense systems, radar systems, sea and air-based mission and combat systems, command and control mission solutions, cyber solutions, and simulation and training solutions. The Space segment offers satellites; space transportation systems; strategic, advanced strike, and defensive systems; and classified systems and services in support of national security systems. This segment also provides network-enabled situational awareness and integrates space and ground global systems to help its customers gather, analyze, and securely distribute critical intelligence data. It serves primarily serves the U.S. government, as well as foreign military sales contracted through the U.S. government. Lockheed Martin Corporation was founded in 1912 and is headquartered in Bethesda, Maryland.
Discounted Cash Flow Valuation of Lockheed Martin Corp
Growth
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Discount
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Multiple
g\r | +10% | +11% | +12% | +13% | +14% |
---|---|---|---|---|---|
0% | 10 | 9 | 8 | 8 | 7 |
+1% | 11 | 10 | 9 | 8 | 8 |
+2% | 13 | 11 | 10 | 9 | 8 |
+3% | 14 | 13 | 11 | 10 | 9 |
+4% | 17 | 14 | 12 | 11 | 10 |
Years | 0 | 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | 9 | 10 | TV |
---|---|---|---|---|---|---|---|---|---|---|---|---|
FCF | $6.216B | $6.835B | $7.477B | $8.139B | $8.815B | $9.498B | $10.18B | $10.86B | $11.52B | $12.16B | $12.77B | $127.7B |
DCF | $5.943B | $5.654B | $5.352B | $5.04B | $4.722B | $4.402B | $4.082B | $3.767B | $3.457B | $3.156B | $31.56B | |
Value | $77.14B |
In the chart Earnings are multiplied by this value.
High margins render the company resilient under dire circumstances, hence able to drive competitors out or acquire them. ROE and ROA measure the average flow generated by each invested dollar. Their marginal value is a forecast of future growth, and it is considered by Buffett and Munger the most important single indicator.
Years | 12-2015 | 12-2016 | 12-2017 | 12-2018 | 12-2019 | 12-2020 | 12-2021 | 12-2022 | 12-2023 | TTM |
---|---|---|---|---|---|---|---|---|---|---|
Net Margin | 7.8% | 11% | 4% | 9.4% | 10% | 10% | 9.4% | 8.7% | 10% | 9.7% |
ROA | 11% | 12% | 13% | 16% | 18% | 17% | 18% | 16% | 16% | 15% |
ROE | 120% | 330% | -330% | 350% | 200% | 110% | 58% | 62% | 100% | 100% |
The average Net Margin over the past 5 years is +9.77%.
The trend of Net Margin over the past 5 years is -0.06%.
The average ROA over the past 5 years is +16.88%.
The trend of ROA over the past 5 years is -0.18%.
The average ROE over the past 5 years is +146.43%.
The trend of ROE over the past 5 years is -48.41%.
Being debt the number one cause of investment losses and company death, the ratio Debt/FCF is of utmost importance to guarantee safety. On the other hand the Graham’s stability measures the drawdown of earnings, hence indicating the reliability of the flow generated by the company.
Years | 12-2015 | 12-2016 | 12-2017 | 12-2018 | 12-2019 | 12-2020 | 12-2021 | 12-2022 | 12-2023 | TTM |
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Debt FCF | 4.12 | 3.71 | 3.07 | 9.04 | 2.58 | 2.15 | 1.66 | 2.77 | 3.03 | 3.36 |
Debt Equity | 5.54 | 9.52 | -26.68 | 11.60 | 4.75 | 2.29 | 1.17 | 1.83 | 2.76 | 3.14 |
MIN | ||||||||||
Graham Stability | - | - | 48% | 100% | 100% | 100% | 100% | 89% | 100% | 48% |
The Debt/FCF trailing twelve month is 3.36.
The trend of Debt/FCF over the past 5 years is -0.86.
Graham’s Stability measure stands at 0.48.
Growth can be dangerous when forecasting, simply projecting the current growth is in general wrong. A company passes through multiple phases, from being young and unprofitable, to the first periods of profitability and high growth, until it arrives at a period of regime with limited growth. Identifying in which phase the company is in may help forecasting.
Years | 12-2016 | 12-2018 | 12-2020 | 12-2022 | Trend |
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Revenue | 5.2% | 4.7% | 1.1% | 2.4% | -0.2% |
Net Income | 3.9% | 6.5% | 0.42% | 21% | -2% |
Stockholders Equity | 23% | 36% | 4.2% | -26% | 3.7% |
FCF | 6.1% | 27% | -0.99% | 1.6% | -2.4% |
The Revenue CAGR over the past 5 years is +4.68%.
The trend of Revenue growth rate over the past 5 years is -0.2%.
The Earnings CAGR over the past 5 years is +6.52%.
The trend of Earnings growth rate over the past 5 years is -1.97%.
The Equity CAGR over the past 5 years is +36.37%.
The trend of Equity growth rate over the past 5 years is +3.72%.
The FCF CAGR over the past 5 years is +27.34%.
The trend of FCF growth rate over the past 5 years is -2.42%.