Lockheed Martin's stock is having its best month in half a century. Thanks, President Trump.

MW Lockheed Martin's stock is having its best month in half a century. Thanks, President Trump.

By Tomi Kilgore

Defense contractor's backlog of orders ballooned to a record $194 billion, boosted by increased spending by Trump's Defense Department

Lockheed Martin's stock is headed for its best month since 1980, after the defense contractor provided an upbeat earnings outlook amid strong demand from the U.S. government for its missiles and fighter jets.

Lockheed Martin's stock is doing great again, as the defense contractor issued on Thursday a full-year earnings and cash-flow outlook that was better than what Wall Street was expecting, fueled by increased military spending by the Trump administration.

The company also announced on Thursday an agreement with the U.S. Defense Department to quadruple the annual production of Terminal High Altitude Area Defense interceptor missiles, to 400 from 96. That builds on the agreement reached with the government earlier this month to more than triple the production of PAC-3 Missile Segment Enhancement interceptor missiles, to 2,000 a year from 600.

"These types of agreements fully support the Department of War's acquisition transformation strategy, and we look forward to continuing our partnership with the U.S. government to definitize the contract and unleash a renewed era of innovation, accountability and execution across the defense industrial base," said CEO James Taiclet, according to an AlphaSense transcript of the post-earnings call with analysts.

Lockheed Martin's stock (LMT) rose 4.2% on Thursday to its first record close in 15 months. It has run up 28.7% in January, to put it on track for the biggest monthly gain since it soared 30.4% in January 1980.

"With a record $194 billion backlog, 6% year-over-year sales growth, and free cash flow generation above our prior expectation, 2025 marked a year of unprecedented demand for Lockheed Martin capabilities," Taiclet said. Within the record backlog, he said the biggest boost in the fourth quarter came from the F-35 fighter-jet program.

Taiclet said the "escalating demand" has been driven by the "combat-proven performance" of the company's products, such as the fighter jets, stealth drones and Black Hawk helicopters used during the military's successful operation in Venezuela earlier this month.

Given the strong start to the year, the company said it expects 2026 sales of $77.5 billion to $80 billion and earnings per share of $29.35 to $30.25. The midpoints of those ranges are above the current average analyst estimates compiled by FactSet for revenue of $77.98 billion and EPS of $29.52.

Free cash flow is expected to total $6.5 billion to $6.8 billion, well above the FactSet consensus of $6.14 billion.

The upbeat outlook comes as Taiclet was optimistic that government spending on the military would continue to increase, as the Trump administration has been pushing to boost the U.S. defense budget by 50% to $1.5 trillion.

Meanwhile, for the fourth quarter that ended Dec. 31, the company reported net income that swelled to $1.34 billion, from $527 million in the same period a year ago, while EPS of $5.80 was just shy of the FactSet consensus of $5.81.

Sales for the quarter grew 9.1% to $20.32 billion to top expectations of $19.86 billion. For the year, sales rose 5.6% to $75.05 billon.

-Tomi Kilgore

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January 29, 2026 16:37 ET (21:37 GMT)

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