Lockheed Martin beats profit estimates, raises 2018 forecast
Strategas Research Partners CEO Jason Trennert provides insight into the earnings season so far.
July 24 (Reuters) - Lockheed Martin Corp's F-35 jet demand once again helped the company beat Wall Street expectations for quarterly profit on Tuesday as the weapons maker raised its forecast for the rest of the year.
The Pentagon's No.1 weapons supplier raised its 2018 net sales forecast to a range of $51.60 billion to $53.10 billion from a range of $50.35 billion to $51.85 billion, sending shares up 2.7 percent to $327.00 in premarket trading on Tuesday.
Full-year profit is now expected to be between $16.75 to $17.05 per share, compared with its earlier estimate of between $15.80 and $16.10 per share.
Revenue from the company's missiles and fire control business, which makes PAC-3 missiles, rose 16.9 percent to $2.09 billion. The PAC-3 is the interceptor in the Patriot missile system. In late March, Poland signed its largest arms procurement deal in its history, a Patriot missile defense system for $4.75 billion.
The company's aeronautics business, which makes the stealthy F-35 fighter jet, posted a 8.1 percent rise in revenue to $5.32 billion.
The company's net income rose to $1.16 billion, or $4.05 per share, in the second-quarter ended June 24 from $955 million, or $3.28 per share, a year earlier.
Net sales rose 6.6 percent to $13.40 billion.
Analysts were expecting adjusted earnings of $3.92 per shares and revenue of $12.74 billion, according to Thomson Reuters I/B/E/S.
The quarterly results included a charge of $96 million related to severance and restructuring activities, which reduced net income by $76 million, or $0.26 per share.
"Although Lockheed beating consensus for the quarter is hardly a novel experience, to do this despite the 26 cents of restructuring is an impressive performance," analyst Robert Stallard of Vertical Research said in a note on Tuesday.
Up to Monday's close, Lockheed's shares had risen 9.7 percent in the past 12 months, compared with a 13.6 percent rise in the S&P 500 index.
(Reporting by Mike Styone in Washington and Sanjana Shivdas in Bengaluru; Editing by Shailesh Kuber and Chizu Nomiyama)