This article was updated on Dec. 14, 2016, and originally published October 19, 2014.

Over-budget, behind schedule, and -- reportedly -- not a particularly good fighter jet, Lockheed Martin's (LMT 0.06%) ultramodern Joint Strike Fighter may be destined for the scrap heap.

In a 2013 RAND Corporation report, one of the nation's foremost military analysts, blasted the F-35 for being a fighter that "can't turn, can't climb, can't run." Proponents of the F-35 reply that because it's stealthy, it shouldn't have to do any of those things -- lobbing missiles at its foes from over the horizon, and long before they can even see it.

Unfortunately, it turns out that the F-35 may not do the "invisibility" thing very well, either.

Photo: Lockheed Martin

Invisible becomes visible -- voila!

As has revealed, China has a new device that may be able to track Lockheed's F-35 fighter with "passive" radar detection technology. Dubbed the DWL002, China's equipment can apparently detect stealth aircraft at distances of up to 400 kilometers -- and 600 kilometers for larger "stealth" targets -- processing "pulse, frequency agility, pulse duration, tactical air navigation system, distance measuring equipment, jitter/stagger radar, and identification friend or foe" signals emitted by the otherwise stealthy aircraft to determine its location.

To be clear, DWL002 is not an active radar system itself. As International Assessment and Strategy Center senior fellow Richard Fisher explains "Passive systems like these simply listen for any electronic emission," identifying an aircraft without having to ping it with an active radar transmitter. As such, whether or not the F-35 is itself invisible to "radar" may be a moot point.

China can "see" it anyway.

Don't look now, Lockheed Martin. But China is watching you. Photo: Wikimedia Commons

And so can Russia

This problem with the F-35's lack of invisibility, it turns out, is not limited to China. According to DN, both the Czechs and the Ukrainians have similar systems for passive intercept of electronic signals, capable of detecting stealth aircraft.

Similarly, Aviation Week reported in 2014 that certain very high frequency (VHF) radar systems, such as Russia's P-14 Oborona VHF early warning system, and its 3D Nebo SVU active electronically scanned array (AESA), may also be capable of detecting the F-35. (A new Chinese naval radar system, Type 517M VHF, may be similarly effective against the F-35.) 

And of course, there is the Balkan War incident to keep in mind. On March 27, 1999, Serbian anti-aircraft forces used a 1960s vintage P-18 VHF acquisition radar system (working in conjunction with an SA-3 SAM system for proximity targeting) to detect and down a F-117 stealth fighter jet.

What this all means for Lockheed Martin

Now, experts differ on how effective these various aircraft detection systems will be against the F-35. For one thing, while passive detection systems can tell an opponent that there's an F-35 "out there," it still takes an active detection system to guide a missile to shoot it down. But if the critics are right, it could still undermine the aircraft's reputation for invisibility, and pose a significant threat to Lockheed Martin's business.

It's been 15 years now since Lockheed Martin won the contract to build what was then known as the "joint strike fighter," beating out Boeing (BA 1.34%) for that honor. Since then, Lockheed stock has risen an astonishing seven times in value, from $35.29 (adjusted for dividends and stock splits) on Oct. 29, 2001, to more than $250 per share today. While many factors contributed to this outperformance, Lockheed's winning the F-35 franchise has certainly contributed mightily to the stock's success.

After all, analysts estimate that over the program's estimate 60-year lifespan, the F-35 will bring Lockheed Martin as much as $1.1 trillion worth of high-margin revenues -- or more. At the 10.7% operating profit margin that Lockheed Martin earns at its Aeronautics division (thanks to S&P Global Market Intelligence for the data), that works out to about $118 billion in profits the company could earn from this single product -- greater than the market capitalization of the whole company.

But if the F-35 comes up short in the "invisibility" department, that franchise could be in jeopardy.

The upshot for investors

The thing about technology is that it's always changing. What was cutting edge tech in 2001 could be obsolete by 2021. If that happens, and if the F-35 is ultimately not built in the quantities originally anticipated (as was the case with Lockheed Martin's similarly high-tech F-22 Raptor fighter jet, you'll recall), then Lockheed Martin stock could be worth less than investors are counting on.