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Friday, 06/20/2003

Locked and Loaded
By Nich Sheldon
LMT - Lockheed Martin Corporation

Company Description

Lockheed Martin Corporation, an advanced technology company, was formed in March 1995 with the merger of two of the world's premier technology companies, Lockheed Corporation and Martin Marietta Corporation.

Headquartered in Bethesda, Maryland, Lockheed Martin employs about 125,000 people worldwide and is principally engaged in the research, design, development, manufacture and integration of advanced technology systems, products and services.

Lockheed Martin is led by Vance D. Coffman, chairman and chief executive officer and Robert J. Stevens, president and chief operating officer.

[Source: Company Website]

Reasons to Invest:

Here at we try and focus our Drip Investments in sectors that are proving to scale the markets proverbial walls. One sector that we believe is continuously proving it can hold off the bears is the Defense Sector (DFX.X). Among the many stocks that pertain to this sector is Lockheed Martin Corporation (NYSE:LMT). LMT looks like a promising Drip to invest in for several reasons of which we will list below.

The first of many reasons that Lockheed Martin looks so promising is their first quarter results. Over the first quarter of 2003 LMT's sales rose 18% to $7.06 billion. Their net income from their regular operations rose 12% to 250 million. This continued increase in sales and revenues is largely due to a higher volume of commercial space activities and a lower operating margin. Nonetheless LMT has yet to take losses over the past four quarters and they are projecting a 10.0% increase over the next five years. Their growth rate for this year is 10.79 and the overhead projection for LMT's growth rate over the next 3 years is 2.06%.

Lockheed Martin continues to announce nothing short of exceptional news for their company. Among the many jobs they have landed in the past, some of the most recent contracts they have been awarded are the $42 million contract to deliver Electro-Optical/Infrared imaging systems for Canada's fleet of CP140 Aurora maritime patrol aircrafts. As well as a $67 million contract to continue production, delivery and installation of the MK 41 Vertical Launching System (VLS) for the United States Navy. This past Wednesday (June, 18th 2003) LMT announced that a new United States Navy enterprise personnel system (developed by LMT) has been installed at all 570 planned Navy ship and shore sites.

Outside of the news, over the past four weeks Lockheed Martin was ranked in the top 33% of the Defense Industry. On a thirteen- week scale they were right around the top 50% of the defense sector, which means that with their continued increase in sales they are continuing to climb that proverbial market wall. With over 1,800 institutions, Drip Investors can be very confident that LMT will be around for a long time.

A quick look at the charts and one may come to the conclusion that LMT's movement is minimal at most. Yet, if you take a closer look at support 46.5 area, LMT could be ready for that next leg up and over 50. We feel that the recent hike from 40 to 50 over the past three months is a promising sign that LMT is ready to perform.

With a continued increase in sales/revenues, awarding of multi- million dollar contracts, and LMT's movement to the top of the defense sector should help Lockheed Martin reach its long-term growth target of 10.0 percent, while returning profits to investors.

Company Highlights:

Leading systems integrator and aerospace technology firm with well-established positions in defense and civil governments worldwide.

Organic top-line growth fueled by $70 billion backlog and new orders opportunities.

Program diversity; top 10 programs represent arount 30% of sales.

U.S. Department of Defense (DoD) budget increases anticipated over the next five years; modernization accounts given greater priority.

Financials strengthened through ongoing emphasis to improve operating margins, generate cash and deploy cash to create value.

Until Next Week,
Nich Sheldon [Source: Company Website]

DRIP Information:

Shares to Qualify = 1
Auto-reinvestment = yes
Min/Max = $50 to $UNLIMITED

Reinvestment Fees - 

Dividend investment fees: none
Cash investment fees: none
Auto reinvestment fees: none

Foreign Accounts Accepted: Yes
Temper Enrollment Allowed: Yes

Agent Info

First Chicago Trust

Investor Contacts:

James Ryan
Vice President, Investor Relations
Phone: (301) 897-6584

Randa Middleton
Director, Investor Relations
Phone: (301) 897-6455

Corporate Headquarters
6801 Rockledge Drive
Bethesda, MD 20817 
Phone: (301) 897-6000
Fax: (301) 897-6919 


Copyright 2003

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