What happened

Defense-giant Lockheed Martin (LMT -0.27%) delivered quarterly results suggesting that the business, after a series of missteps, is back on track. Investors were pleased, sending the company's shares up as much as 5%.

So what

Lockheed Martin investors had a tough time in 2021. The stock underperformed as the company worked its way through a period of transition. Many more mature programs aged off the books and new, potentially promising programs are still in the pre-revenue stages.

We said back then that Lockheed would likely focus on returning cash to shareholders during the lull. On Tuesday, the company came through with solid results and plans to boost its return to investors.

The company earned $6.71 per share in the third quarter on revenue of $16.6 billion, roughly in line with analyst expectations for $6.70 per share in earnings on revenue of $16.65 billion. The company also said it had authorized an additional $14 billion in share-repurchase authority -- equal to about 12% of its market capitalization at current prices -- and a 7% boost to its dividend.

The world's largest defense contractor has already reduced its share count by 17% over the past decade through buybacks.

"Lockheed Martin delivered a solid quarter, highlighted by strength in free cash flow, orders, and operating margins, that positions us well to achieve our full-year commitments," CEO James Taiclet said in a statement. "Our continuing ability to deliver strong financial performance in turn enables further investments in the 21st century security technologies essential to support our customers."

Now what

There were some disappointments in the release. Lockheed Martin still expects to earn about $21.55 per share on revenue of $65.25 billion in 2022, which is a little shy of the consensus $21.67 per share on $65.29 billion in sales estimates. And 2023 sales are expected to be flat, with a return to growth in 2024.

Drilling deeper into the quarter, Lockheed Martin's aerospace and space divisions outperformed, but both its helicopters and missile units were underwhelming.

There's still work to be done, but Lockheed Martin has a backlog of $140 billion in future orders and dominant positions in Pentagon priority areas, including hypersonic missiles. Those futuristic programs will take time to translate into revenue and profits, but Lockheed Martin offers a dividend that yields 2.87%, even before the planned boost for those willing to wait for that growth.

For investors willing to take a long-term approach, there's a lot to like about Lockheed Martin right now.