Lockheed Martin Corporation's New Secret Weapon... Isn't a Weapon at All

But that doesn't mean you should underestimate it.

Feb 10, 2014 at 1:31PM

The most popular military transport in the world: Lockheed Martin's C-130J. Photo: Wikimedia Commons

Lockheed Martin's (NYSE:LMT) C-130J Super Hercules is a monster. At 39 feet tall, 113 feet long, and with a 133-foot wingspan, this military transport plane can carry 128 soldiers, 22 tons of cargo, or an entire armored personnel carrier within its capacious hold, and is rugged enough to land them on short, unimproved runways -- then take off again from same. With 1,131 planes in use by 16 nations around the globe, it's hands-down the most popular military transport on the planet.

And now Lockheed Martin is preparing to deploy the C-130J to maintain its dominance in one key segment of the civilian aircraft market as well.

Super Hercules receives honorable discharge to civilian life
Last week, Lockheed announced plans to launch a new commercial aircraft, derived from the uber-successful C-130J. Dubbed the LM-100J, Lockheed says its new civilian variant of the C-130J will be a "civil multi-purpose air freighter capable of rapid and efficient transport of cargo... particularly to austere locations worldwide."

Like the military C-130J, the new LM-100J can take off from and land on "short, unprepared airfields without ground support equipment." Lockheed describes the new plane as ideal for such missions as fighting forest fires, transporting cargo to remote and "austere" locations, and medevac/air ambulance.

Lockheed intends to offer the plane as a modern-day upgrade to its previous civilian plane, the L-100, which was itself based on the original design of the military C-130. More than 100 L-110s were sold over the 28 years the plane was produced. Now, according to Reuters, Lockheed aims to sell at about 75 of the updated LM-100Js -- primarily to mining and oil exploration companies, but also to government agencies and to other commercial customers as well.


A Delta-owned Lockheed L-100 in flight. Photo: Wikimedia Commons

Lacking some of the high-tech avionics and communications equipment installed on its military variant, Lockheed expects to sell the civilian LM-100J for a bit less than the C-130J Super Hercules (which retails for about $70 million). The reported asking price for the LM-100J will be "in the mid-$60-million range." Even so, this appears to make the plane close to a $5 billion opportunity for Lockheed -- before factoring in revenues from maintaining, servicing, and (eventually) selling upgrades on the planes.

For Lockheed Martin, which did $45 billion in business last year, that may not sound like much. But you know what they say -- $5 billion here, $5 billion there, and pretty soon, Lockheed Martin will be making some real money.

Meet Lockheed Martin's new profit driver: The civilian version of the Super Hercules. Source: Lockheed Martin

Oh, and one more thing
Did I mention that Lockheed Martin pays its shareholders a 3.4% dividend yield? Mustn't forget that bit -- because over time, generous dividend-paying stocks like Lockheed can make you rich. While they don't garner the notability of high-flying tech stocks, dividend-paying stocks are also less likely to crash and burn. And over the long term, the compounding effect of the quarterly payouts, as well as their growth, adds up faster than most investors imagine.

With this in mind, our analysts sat down to identify the absolute best of the best when it comes torock-solid dividend stocks, drawing up a list in this free report of nine that fit the bill. To discover the identities of these companies before the rest of the market catches on, you can download this valuable free report by simply clicking here now.


Rich Smith has no position in any stocks mentioned. The Motley Fool owns shares of Lockheed Martin. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

4 in 5 Americans Are Ignoring Buffett's Warning

Don't be one of them.

Jun 12, 2015 at 5:01PM

Admitting fear is difficult.

So you can imagine how shocked I was to find out Warren Buffett recently told a select number of investors about the cutting-edge technology that's keeping him awake at night.

This past May, The Motley Fool sent 8 of its best stock analysts to Omaha, Nebraska to attend the Berkshire Hathaway annual shareholder meeting. CEO Warren Buffett and Vice Chairman Charlie Munger fielded questions for nearly 6 hours.
The catch was: Attendees weren't allowed to record any of it. No audio. No video. 

Our team of analysts wrote down every single word Buffett and Munger uttered. Over 16,000 words. But only two words stood out to me as I read the detailed transcript of the event: "Real threat."

That's how Buffett responded when asked about this emerging market that is already expected to be worth more than $2 trillion in the U.S. alone. Google has already put some of its best engineers behind the technology powering this trend. 

The amazing thing is, while Buffett may be nervous, the rest of us can invest in this new industry BEFORE the old money realizes what hit them.

KPMG advises we're "on the cusp of revolutionary change" coming much "sooner than you think."

Even one legendary MIT professor had to recant his position that the technology was "beyond the capability of computer science." (He recently confessed to The Wall Street Journal that he's now a believer and amazed "how quickly this technology caught on.")

Yet according to one J.D. Power and Associates survey, only 1 in 5 Americans are even interested in this technology, much less ready to invest in it. Needless to say, you haven't missed your window of opportunity. 

Think about how many amazing technologies you've watched soar to new heights while you kick yourself thinking, "I knew about that technology before everyone was talking about it, but I just sat on my hands." 

Don't let that happen again. This time, it should be your family telling you, "I can't believe you knew about and invested in that technology so early on."

That's why I hope you take just a few minutes to access the exclusive research our team of analysts has put together on this industry and the one stock positioned to capitalize on this major shift.

Click here to learn about this incredible technology before Buffett stops being scared and starts buying!

David Hanson owns shares of Berkshire Hathaway and American Express. The Motley Fool recommends and owns shares of Berkshire Hathaway, Google, and Coca-Cola.We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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