The Pentagon says it will free up more of the cash it withheld from Lockheed-Martin (LMT) for over 100 of its F-35 fighter jets, the costly program which has come under fire from Elon Musk as he looks to cut federal government spending.
It seems the Defense Department will reduce funds withheld from LMT by around $1.2 million per plane. Currently the Pentagon has held back around $5 million for 106 aircraft delivered last year until LMT installs some of the newest hardware and software.
Defense officials told Bloomberg that the company had “made progress developing and validating the TR3 hardware and software package.” The TR3 system is a year late and over budget.
F-35 Under Fire
The news comes amid controversy about the program stemming from Musk’s criticism of the scheme as he leads President Trump’s Department of Government Efficiency (DOGE).
He said, “some idiots are still building manned fighter jets like the F-35,” in a recent post on his platform X.
But the then-Air Force Secretary Frank Kendall said, “The F-35 isn’t going away.”
However, a change of administration could spark a rethink of the Pentagon’s current aims to expand the fleet of F-35s. The 2026 Fiscal year defense budget will provide the first clues for LMT and its $485 billion jet fighter program.
Getting rid of manned fighter jets would have massive repercussions for both the military and for defense contractors such as LMT.
LMT Earnings on Tap
LMT is due to report Fiscal fourth quarter earnings today, January 28th. Wall Street analysts expect Lockheed Martin to deliver earnings of $6.62 per share on revenues of $18.87 billion. Last quarter, LMT beat earnings estimates, reporting EPS of $6.84 on estimates of $6.50.
Is Lockheed Martin Stock a Buy?
Wall Street’s consensus rating for LMT stock is a Moderate Buy, based on six Buys and eight Holds. The average analyst price target of $546.57 implies upside potential of about 8% from current levels.
