Lockheed Martin Guidance Falls Short
October 22 2019 - 08:56AM
Dow Jones News
By Doug Cameron
Lockheed Martin Corp. said Tuesday it expects slower sales
growth next year, with domestic budget headwinds and changing
Pentagon priorities clouding the outlook for defense
contractors.
The world's largest defense company by sales expects revenue to
grow to around $62 billion in 2020, below the pace expected by
investors who have driven its shares up 45% so far this year as
profits soared on growing deliveries from its more than $100
billion backlog of orders for missiles, space equipment and F-35
combat jets.
Lockheed Martin provided its outlook alongside forecast-beating
quarterly earnings and still expects to meet its longstanding
pledge on generating cash and returning it to shareholders via
buybacks and dividends, though it cautioned this could be hit by
complex relations between the U.S. and Turkey, one of its largest
export markets.
The company's initial 2020 outlook follows two strong quarters
of growth, but the absence of raised guidance sent its shares down
more than 2% in pre-open trade.
Lockheed Martin's sales guidance compares with expectations for
revenues of $59 billion this year, with free cash above $7.2
billion and margins of up to 10.8%, at the low end of analysts'
expectations.
Profit in the September quarter rose to $1.61 billion from $1.47
billion, with per-share earnings climbing to $5.70 from $5.18, well
above the $5.02 consensus among analysts polled by FactSet.
Write to Doug Cameron at doug.cameron@wsj.com
(END) Dow Jones Newswires
October 22, 2019 08:41 ET (12:41 GMT)
Copyright (c) 2019 Dow Jones & Company, Inc.
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