Shares of Lockheed Martin
In a nutshell, the problem is this: Lockheed beat Boeing
Fear no more
Yesterday's news suggests those fears may have been overblown. According to reports from both Reuters and AP, the government of recent NATO-admittee Romania is negotiating to buy not one, not two, but four dozen F-16s from Lockheed.
Twenty-four planes would be brand-spanking-new F-16C/D Block 50/52s, powered either by engines from GE
Be careful what you wish for
Good news for Lockheed? You can look at it that way, and the news may explain why Lockheed's shares gained some altitude on a generally anemic trading day yesterday. Although Raytheon
But there's a downside to making the F-16 sale, too -- if Romania buys F-16s today, it may not need to buy F-35s tomorrow.
How much is that downside worth?
- Price for 24 new and 24 used F-16s: $4.5 billion.
- Price for 48 of the high-tech F-35s that Lockheed may be selling to Norway this year: Not exactly priceless, but expected to come in close to three times higher at $11.7 billion.
Moral of the story for Lockheed shareholders: Be careful what you wish for.