NEW YORK, Jan 8, 2026, 11:45 EST — Regular session
Lockheed Martin shares rose 5.2% to $522.56 on Thursday, extending a volatile two-day stretch after President Donald Trump called for a $1.5 trillion U.S. military budget for 2027. The stock hit $542.66 earlier in the session before drifting back.
The whipsaw matters because the same White House that is talking up a much larger defense top line is also threatening to police how contractors spend their cash. “A limit on capital return is an incremental negative, but the size is manageable,” Morgan Stanley analysts led by Kristine Liwag wrote, while RBC Capital Markets analysts led by Ken Herbert flagged uncertainty around what Congress ultimately approves. Reuters
Trump’s executive order says contractors are not permitted to pay dividends or buy back shares — when a company repurchases its own stock — until they can produce a “superior product, on time and on budget.” The order gives Defense Secretary Pete Hegseth 30 days to identify underperforming contractors and points the SEC toward rules that could support enforcement. Reuters
Lockheed has its own production story to sell. The company said Tuesday it reached a seven-year agreement with the U.S. Department of War to lift annual PAC-3 missile interceptor capacity to 2,000 units from about 600, with an initial contract award expected to depend on final fiscal-year 2026 appropriations.
Late Wednesday, Lockheed said it delivered 191 F-35 fighter jets in 2025, up from 110 in 2024, and called it a record year for the program. The company said annual F-35 production is running “five times faster” than any other allied fighter currently in production. Reuters
On Thursday, the company added a smaller, steadier headline: Derco, a Lockheed unit, said it won a C-130 aviation consumables performance-based logistics contract from the Defense Logistics Agency. “We share in their mission of maintaining high material availability,” Derco president and general manager Kathy Medalle said. Media – Lockheed Martin
Beyond defense, investors were also bracing for a labor-market read that can move rates and, by extension, equity multiples. Weekly jobless claims rose 8,000 to 208,000, and a Reuters survey showed economists expect nonfarm payrolls to increase about 60,000 in December when the report lands Friday.
But the trade has sharp edges. A $1.5 trillion budget pitch still runs into the math and the politics of Congress, and any hard cap on payouts could push investors to reprice the sector’s “safe cash return” profile. If the policy fight turns into contract terms, it may show up first in guidance language rather than in a single headline.
Next up for Lockheed is its fourth-quarter and full-year results, due before the market opens on Jan. 29, followed by a conference call at 8:30 a.m. ET.
