Lockheed Martin (NYSE:LMT) is expected to deliver earnings that come in ahead of estimates when it posts its third-quarter financials this week.
The global aerospace and defense company has surprised investors with an average earnings beat of 5.04% over the past four quarters.
For its 3Q, the company's performance is expected to benefit from higher sales volumes across key segments and a lower share count.
However, the Aeronautics segment, a significant contributor to Lockheed Martin (NYSE:LMT)'s revenue, is predicted to post lackluster results due to unfavorable F-35 deliveries caused by software maturation issues. Despite this, higher production and sustainment volumes for the F-16 and classified programs are expected to buoy this segment's performance.
On the brighter side, other segments like Space, Missiles and Fire Control (MFC), and Rotary and Mission Systems (RMS) are expected to shine in the third quarter. Increased development volume from next-generation interceptors and classified programs is likely to boost the Space segment.
In the Missiles and Fire Control segment, higher sales volume from tactical and strike missiles is expected to outweigh lower volume from integrated air and missile defense.
Meanwhile, the Rotary and Mission Systems segment is expected to see sales growth from integrated warfare systems and sensors programs.
Delivery projections are strong for Lockheed Martin (NYSE:LMT), with an estimated 58 jets to be delivered in the third quarter, reflecting a 6.5% year-over-year growth. Analysts are optimistic that the combined positive sales momentum from the three major segments will outweigh the sales dip from the Aeronautics segment.
Market expectations for Lockheed Martin's third-quarter revenue stand at $16.7 billion, indicating a 0.5% year-over-year increase, with consensus earnings estimate of $6.66 per share.
The stock has seen a 7% dip since the last earnings release.
Shares of Lockheed Martin were trading around $437.81 on Monday.