Lockheed Martin (LMT) Stock: Two Pentagon Contracts and a Wall Street Upgrade

TLDR

• The Pentagon awarded Lockheed Martin a $35.5 billion, seven-year contract for THAAD missile interceptor production.
• Lockheed also secured a separate $2.9 billion US Army contract to manufacture Sentinel A4 radars.
• LMT stock is down 23% since the start of the Iran war, trading at around $518.
• Citi analyst John Godyn upgraded LMT to Buy from Hold, raising his price target to $582 from $571.
• Lockheed plans to invest over $9 billion in 20 new or upgraded munitions production facilities by 2030.

Lockheed Martin (LMT) landed two major Pentagon contracts on July 1 and picked up a Wall Street upgrade — all in one day. The stock was trading at $518.28, up 1.8% in early Wednesday trading.

Lockheed Martin Corporation, LMT

The headline deal is a $35.5 billion contract for THAAD missile interceptors. It’s a seven-year “undefinitized” contract, meaning work can start before all terms — including final price and total missile count — are locked in.

The THAAD is the US military’s top-tier anti-ballistic missile system. It can knock out incoming threats both inside and outside the atmosphere using kinetic force alone, no explosive warhead needed. Each interceptor travels at Mach 8.2.

The contract is the first major multiyear procurement deal under the Pentagon’s new “Arsenal of Freedom” initiative, which aims to speed up weapons production and delivery to frontline units.

To meet the contract’s demands, Lockheed plans to build or modernize 20 munitions production facilities across the US by 2030. The price tag for that buildout is expected to exceed $9 billion.

The THAAD contract is also seen as a key building block for President Trump’s planned “Golden Dome” air defense network — a nationwide missile defense shield.

Second Major Army Deal

On the same day, Lockheed secured a separate $2.9 billion US Army contract to produce Sentinel A4 radars. The program runs through June 2031.

The Sentinel A4 uses digital processing and solid-state gallium nitride antenna modules. It can operate in fixed and mobile configurations and detect not just aircraft and drones, but also rockets, artillery, and mortar fire — tracking both origin and point of impact.

Lockheed first won the Sentinel A4 development contract back in 2019, with low-rate initial production units delivered earlier this year.

Citi Upgrades LMT to Buy

Despite the contract wins, LMT has had a rough stretch. The stock is down 23% since the start of the war in Iran — a drop that Citi analyst John Godyn now sees as a buying opportunity.

Godyn upgraded LMT from Hold to Buy and lifted his price target to $582 from $571.

The stock now trades at about 17 times forward earnings. That’s down from roughly 22 times at the start of the conflict — a level more in line with the broader S&P 500 at the time.

Godyn cited improving fundamentals, particularly Lockheed’s exposure to missile production, which the military is actively prioritizing. He also pointed to a historical pattern: LMT has posted double-digit quarterly drops nine times since 2009, and bounced back seven of those times — with six of those recoveries being double-digit gains.

Only 36% of analysts currently rate LMT a Buy, well below the S&P 500 average of 55%–60%. The average analyst price target sits at around $618.

Lockheed’s Q2 2026 earnings call is scheduled for July 23.

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