Lockheed Martin: Scaling Defense Production
Lockheed Martin (LMT 0.23%) primarily generates revenue by researching, designing, and manufacturing advanced aerospace and defense systems for the U.S. government.
It recently signed a framework agreement to quadruple the production capacity of specific defense interceptors.
Northrop Grumman: Advancing Aircraft Programs
Northrop Grumman (NOC 0.40%) operates globally by developing and producing advanced aircraft, weapons, and mission systems.
It reached an agreement to increase bomber production capacity by 25% while also disclosing an anomaly-related launch charge.
Why Revenue Matters for Retail Investors
Revenue here refers to the data provider's standardized income statement revenue line item, representing the total money brought in from sales, to help investors measure a company's operational scale.
Quarterly Revenue for Lockheed Martin and Northrop Grumman
| Quarter (Period End) | Lockheed Martin Revenue | Northrop Grumman Revenue |
|---|---|---|
| Q2 2024 (June 2024) | $18.1 billion | $10.2 billion |
| Q3 2024 | $17.1 billion (period ended Sept. 2024) | $10.0 billion (period ended Sept. 2024) |
| Q4 2024 (Dec. 2024) | $18.6 billion | $10.7 billion |
| Q1 2025 | $18.0 billion (period ended March 2025) | $9.5 billion (period ended March 2025) |
| Q2 2025 | $18.2 billion (period ended June 2025) | $10.4 billion (period ended June 2025) |
| Q3 2025 | $18.6 billion (period ended Sept. 2025) | $10.4 billion (period ended Sept. 2025) |
| Q4 2025 (Dec. 2025) | $20.3 billion | $11.7 billion |
| Q1 2026 | $18.0 billion (period ended March 2026) | $9.9 billion (period ended March 2026) |
Data source: Company filings.
Foolish Take
Lockheed Martin and Northrop Grumman are two of the best-known and most significant defense stocks around. Over the last two years, each company has grown its trailing 12-month revenue by the mid-single digits. Lockheed’s revenue has increased by about 5.7%, and Northrop’s revenue has increased by about 4.0%. For investors pondering an investment in the defense or aerospace sector, both stocks are worthy of consideration.
Let’s start with Lockheed. It is the larger of the two, with a market cap of roughly $117 billion as of this writing. It has a price-to-earnings (P/E) ratio of 25x and a dividend yield of 2.7%. Its key products include the F-35 stealth fighter, the PAC-3 missile defense system, the C-130 Hercules transport aircraft, and the Black Hawk helicopter.
Turning to Northrop, its market cap is about $78 billion as of this writing. Its dividend yield is 1.7%, and its P/E ratio is 17x. Some of Northrop’s key programs include the B-21 stealth bomber, the Sentinel intercontinental ballistic missile, and space systems, including the NASA Artemis mission.
Value-focused investors may prefer Northrop, given its more affordable valuation, while those focused squarely on income may favor Lockheed, given its higher dividend yield.
