UBS analyst Gavin Parsons highlighted that Lockheed Martin is poised for growth across multiple business segments, particularly in missiles and munitions, which could lead to a compound annual growth rate (CAGR) of 9% in revenue through 2028. This growth potential is not reflected in the stock's current pricing, which is at a 15% discount compared to the S&P 500.
Despite recent geopolitical tensions, Lockheed's stock has only increased 8% in 2026, down from a 40% rise earlier in the year. Parsons expressed confidence in the company's ability to generate free cash flow, projecting a 38% growth from 2025 to 2030, which could support pension funding and other cash flow uses.
The analyst community remains divided on Lockheed, with 13 out of 24 analysts rating it a hold, while 10 have buy or strong buy ratings. Following the upgrade, Lockheed's shares rose nearly 1%