Monday, January 27, 2014

Lockheed Martin (LMT) to Furlough 3,000 on Government Shutdown

Top Gold Stocks To Own For 2015

NEW YORK (TheStreet) -- Lockheed Martin (LMT) may be the latest casualty of the government shutdown as the defense contractor announced it will furlough 3,000 employees Monday, October 7. The company expects that number to grow if the shutdown is prolonged.

The shutdown, stretching into its fourth day on Friday, is a result of a stalemate among Congressional leaders to agree on a new budget.

"I'm disappointed that we must take these actions and we continue to encourage our lawmakers to come together to pass a funding bill that will end this shutdown," CEO Marillyn A. Hewson said in a statement.

Lockheed Martin says an employee will be furloughed if their work takes place in a closed government facility, if their role requires government inspection, or if the company has received a stop-work order. Boeing (BA) said it also anticipates "limited" furloughs as of next week, according to Bloomberg. And United Technologies (UTX), a supplier of helicopters to the U.S. military, says it could see as many as 5,000 workers furloughed if the shutdown stretches into November. Shares of Lockheed Martin Corp stock were down today by $0.33 (0.27%) as of the close of trading. By the end of trading, 2.49 million shares changed hands compared to its average daily volume of 1.59 million shares. The stock ranged in price between $121.52 to $123.41 after opening the day at $123.40 as compared to the previous trading day's close of $122.83. Overall, Lockheed Martin Corp lagged the S&P 500 which was up 0.71%.  TheStreet Ratings team rates Lockheed Martin Corp as a Buy with a ratings score of B-. TheStreet Ratings Team has this to say about their recommendation: "We rate Lockheed Martin Corp (LMT) a BUY. This is driven by multiple strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its solid stock price performance, growth in earnings per share, notable return on equity and increase in net income. 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 41.27% 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. Lockheed Martin Corp has improved earnings per share by 10.9% in the most recent quarter compared to the same quarter a year ago. 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 $8.34 vs. $7.86 in the prior year. This year, the market expects an improvement in earnings ($9.46 vs. $8.34). The company's current return on equity greatly increased when compared to its ROE from the same quarter one year prior. This is a signal of significant strength within the corporation. Compared to other companies in the Aerospace & Defense industry and the overall market, Lockheed Martin Corp's return on equity significantly exceeds that of both the industry average and the S&P 500. 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 10% when compared to the same quarter one year prior, going from $781 million to $859 million. LMT, with its decline in revenue, underperformed when compared the industry average of 8.6%. Since the same quarter one year prior, revenues slightly dropped by 4.3%. 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 Written by Keris Alison Lahiff.

No comments:

Post a Comment