Goldman Sachs Upgrades Lockheed Martin (LMT) to Conviction Buy

May 30, 2013 7:18 AM EDT
Get Alerts LMT Hot Sheet
Price: $257.73 +0.27%

Rating Summary:
    12 Buy, 15 Hold, 1 Sell

Rating Trend: Up Up

Today's Overall Ratings:
    Up: 30 | Down: 30 | New: 23
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Goldman Sachs upgraded Lockheed Martin (NYSE: LMT) from Neutral to Conviction Buy with a price target of $127, calling it the best business and best dividend in the Defense sector.

The firm cited three key drivers:

(1) Lockheed has the best overall cash story in the space - "LMT has been consistently converting net income to free cash at a stronger pace than peers. It then consistently ranks in the top 3 of the primes on the total “social contract” paid to shareholders (dividend yield + share repurchase accretion) with the industry leading dividend yield."

(2) Lockheed has the best positioned business - "Most Defense companies claim to be in the sweet spot of Pentagon priorities. But LMT has shown it in the numbers.

(3) JSF improving - "The F-35 program has had some challenges over time from a development timeline and cost perspective. But it is now largely through its most challenging phases of development, and the most recent datapoints have been an acceleration in IOC (which is rarely seen on new programs), a reduction in the cost profile, and an across-the-board reaffirmation of international customer support."

For an analyst ratings summary and ratings history on Lockheed Martin click here. For more ratings news on Lockheed Martin click here.

Shares of Lockheed Martin closed at $107.31 yesterday.

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