---
title: "Lockheed Martin (LMT) beats Q3 estimates as Missiles And Fire Control grows fastest"
canonical_url: https://www.stockexpertai.com/journal/2026-11-01/why-lockheed-martin-lmt-missile-sales-led-its-third-quarter-earnings-beat-a4a86c34325b
last_updated: 2026-11-01T04:59:48.233Z
section: "Sector Spotlight"
author: "Stock Expert AI Research"
publisher: Stock Expert AI
tickers: LMT
content_type: journal-article
---

# Lockheed Martin (LMT) beats Q3 estimates as Missiles And Fire Control grows fastest

_Lockheed's missiles-and-fire-control unit posted the sharpest segment growth in the quarter ended Sept. 27, 2026, while the operating margin stayed below a year earlier._

![Data cover: Lockheed Martin (LMT) beats Q3 estimates as Missiles And Fire Control grows fastest](/public-objects/streetnews/2026-11-01/SECTOR_SPOTLIGHT-cover-3fb6bf35.jpg)
Stock Expert AI data cover: figures from Financial Modeling Prep; background is an illustrative public-domain photo, credited on the image.

Lockheed Martin (LMT) reported third-quarter earnings per share of 7.97 on Oct. 22, 2026, ahead of the analyst estimate of 7.52, on revenue of $20.71B. Missiles And Fire Control and Aeronautics accounted for most of the revenue increase. The operating margin did not widen with it, and that is the part worth watching.

*Figures are current as of Oct. 30, 2026 (latest share quote) and cover the quarter ended Sept. 27, 2026, unless stated otherwise.*

## Key facts

- **Oct. 22, 2026:** Lockheed reported diluted EPS of 7.97 against an estimate of 7.52, a difference of +$0.45 (6.0%).
- **Quarter ended Sept. 27, 2026:** Revenue was $20.71B, against an estimate of $20.48B (+$234.8M, 1.1%). Revenue was 11.3% higher than the year-ago quarter.
- **Quarter ended Sept. 27, 2026:** Net income was $1.84B, 14.0% higher than a year earlier. Operating income was $2.44B.
- **Quarter ended Sept. 27, 2026:** Free cash flow was $3.00B. This is cash left after running the business and paying for equipment and facilities.
- **Oct. 30, 2026:** The share price was 636.95 USD, down 1.03% on the day. The 52-week range is 437.25-692 USD.

| Metric | Q3 FY2026 | Q3 FY2025 (year-ago) |
|---|---|---|
| Revenue | $20.71B | $18.61B |
| Operating income | $2.44B | $2.28B |
| Net income | $1.84B | $1.62B |
| Diluted EPS | 7.97 | 6.95 |

## What happened

**The theme.** Defense spending is a long-cycle business. Governments sign multi-year contracts, and companies like Lockheed recognize the revenue as they build and deliver. As a result, changes show up in segment sales over several quarters. Recent headlines have focused on large missile-defense programs, including the Golden Dome effort, and on how many public companies might share in that work. Those headlines are context only. The reported numbers below are what Lockheed has actually booked.

**The example.** Lockheed reports four segments. Every one had higher revenue than a year earlier in the quarter ended Sept. 27, 2026:

| Segment | Q3 FY2026 revenue | Q3 FY2025 revenue |
|---|---|---|
| Aeronautics | $8.21B | $7.26B |
| Missiles And Fire Control | $4.50B | $3.62B |
| Rotary and Mission Systems | $4.51B | $4.37B |
| Space | $3.48B | $3.36B |

Missiles And Fire Control grew by the largest proportion. Aeronautics, the largest segment, added the most in dollars. Rotary and Mission Systems and Space grew more modestly. This article does not draw on a call transcript or company release, so it does not explain management's view of each segment's results. The figures do show that Missiles And Fire Control and Aeronautics accounted for most of the revenue increase.

By geography, the United States accounted for $14.35B of third-quarter revenue. Europe contributed $2.78B, Asia Pacific $2.22B, the Middle East $700.0M and other regions $665.0M. The United States was by far the largest geographic market, with a meaningful international share.

## Why it matters for investors

**Profit grew, but operating margin did not.** Net income rose faster than revenue in percentage terms. Even so, the operating margin (operating profit as a share of sales) was 11.8% in the latest quarter, below the 12.3% of the year-ago quarter. Here is how margin and cash have moved over five quarters:

| Quarter ended | Operating margin | Free cash flow |
|---|---|---|
| Sept. 28, 2025 | 12.3% | $3.35B |
| Dec. 31, 2025 | 11.5% | $2.76B |
| March 29, 2026 | 11.4% | $-291.0M |
| June 28, 2026 | 12.4% | $2.92B |
| Sept. 27, 2026 | 11.8% | $3.00B |

This table shows that margin moves in a fairly narrow band, and that the first quarter of 2026 was the weak spot for cash. Operating cash flow was only $220.0M that quarter, then recovered to $3.23B and $3.44B in the next two. Cash flow in this industry can be uneven because of the timing of customer payments.

**Where the cash is going.** Dividends were $796.0M in the latest quarter. Buybacks were $0.00 in each of the last three quarters, compared with $1.00B in the quarter ended Sept. 28, 2025 and $750.0M in the quarter ended Dec. 31, 2025. The dividend yield is 2.2%. Cash and short-term investments were $5.96B against total debt of $20.50B, leaving net debt of $14.54B. Shareholders' equity was $10.06B, and debt/equity is 2.04. Two financial-health scores are solid: a Piotroski score of 8 (on a 0-9 scale) and an Altman Z of 3.78.

**Valuation against peers.** On trailing-12-month figures, Lockheed trades at a P/E of 22.53 (price relative to yearly earnings). Net margin is 8.2%.

| Company | P/E | Net margin |
|---|---|---|
| Lockheed Martin (LMT) | 22.53 | 8.2% |
| Boeing (BA) | 17.96 | 8.1% |
| BAE Systems (BAESY) | 29.57 | 7.2% |
| Dassault Aviation (DUAVF) | 23.78 | 11.4% |
| Leonardo (FINMY) | 26.54 | 5.5% |

Lockheed has the second-lowest P/E in this group and has a higher net margin than most of it, apart from Dassault Aviation. The other ratios are price/sales of 1.86, EV/EBITDA of 15.45 and price/free cash flow of 17.56.

**Analysts.** Of 37 ratings, 23 are Buy, 13 are Hold and 1 is Sell, for a consensus of "Buy." The average price target is 638.22 USD, the median is 615.00 USD, the high is 835.00 USD and the low is 560.00 USD. The average sits close to the Oct. 30 share price. On Oct. 26, 2026, Morgan Stanley upgraded the stock from Equal Weight to Overweight, while JP Morgan kept a Neutral rating. FMP's own discounted cash flow model puts value at 775.99 USD per share as of Oct. 31, 2026. That is one model's estimate and depends heavily on its assumptions.

**Our MoonshotScore.** Stock Expert AI's MoonshotScore V2 for Lockheed is 79.1, rated Strong. Its sector-relative pillars are momentum 84, growth 76, quality 77, safety 67 and valuation 49. In plain terms, the stock scores well on price trend, sales growth and business quality. It scores weakest on valuation, meaning it is not cheap relative to its sector.

## What could go wrong

- **Margins.** Revenue growth did not lift the operating margin above the year-ago level. If new work carries thinner margins, profit may grow more slowly than sales.
- **Valuation.** The weakest MoonshotScore pillar is valuation at 49, and the share price is near the analyst average target.
- **Insiders.** Among the 30 most recent Form 4 filings, those dated in the last 90 days showed 0 open-market purchases and 12 sales. Insider sales are often routine, but there were no purchases to offset them.
- **Geographic concentration.** The United States was by far the largest geographic market, at $14.35B of revenue, so budget decisions and contract timing there matter. The balance sheet also carries meaningful debt, and buybacks have paused.

## What to watch next

Lockheed's next earnings date is Feb. 4, 2027. The EPS estimate is 8.4 and the revenue estimate is $22.63B. Key questions: does Missiles And Fire Control keep growing, does the operating margin move back toward the 12.3% reported a year ago, and does free cash flow hold up after the weak first quarter of 2026? Also watch whether buybacks resume.

## Frequently asked questions

## Q: Did Lockheed Martin beat earnings expectations in the third quarter of 2026?

Yes. In the quarter ended Sept. 27, 2026, Lockheed reported EPS of 7.97 against an estimate of 7.52, and revenue of $20.71B against an estimate of $20.48B. It reported on Oct. 22, 2026.

## Q: Which Lockheed Martin business grew the most?

Missiles And Fire Control grew by the largest proportion, from $3.62B a year earlier to $4.50B in the quarter ended Sept. 27, 2026. Aeronautics remained the largest segment at $8.21B.

## Q: What do analysts think Lockheed Martin stock is worth?

Analyst price targets average 638.22 USD, with a median of 615.00 USD and a range from 560.00 USD to 835.00 USD. The stock was quoted at 636.95 USD on Oct. 30, 2026. Targets are analyst opinions, not predictions by Stock Expert AI.



*This is educational content, not investment advice. Past performance does not guarantee future results.*

## Related Tickers
- [LMT](https://www.stockexpertai.com/stock/lmt)

## Sources
- [Stock Expert AI LMT page: quote, financials and MoonshotScore](https://www.stockexpertai.com/stock/lmt)
- [seekingalpha.com: Emerson Among 14 Dividend Growth Companies To Announce Annual Dividend Increases In First Half Of November](https://seekingalpha.com/article/4960688-emerson-14-dividend-growth-companies-annual-dividend-increases-first-half-november)
- [247wallst.com: Lockheed Martin Beats General Dynamics on 2 Key Measures. Is It the Better Dividend Stock?](https://247wallst.com/investing/2026/10/31/lockheed-martin-beats-general-dynamics-on-2-key-measures-is-it-the-better-dividend-stock/)
- [fool.com: Golden Dome Is a $185 Billion Program, but Anduril Is Private. Here Are the 3 Public Companies Building It.](https://www.fool.com/investing/2026/10/31/golden-dome-is-a-185-billion-program-but-anduril-i/)

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_Written by Stock Expert AI's research desk with AI assistance. Figures come from FMP data and the official sources cited in the article. Educational research, not financial advice._