Lockheed Martin Shares Gain on Major Defense Contracts

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Lockheed Martin's stock performance at the start of 2026 demonstrated notable strength, with shares advancing 2.77 percent to close at $497.07 on Friday. This upward move occurred despite the publication of a critical Pentagon report concerning the F-35 fleet, as investor focus shifted decisively toward substantial new contract awards and significant funding authorizations.

A broader positive sentiment took hold across the defense sector. Adding to the industry's momentum, Boeing secured a $2.73 billion contract for Apache helicopter support services late in the week. The clustering of multibillion-dollar contract announcements over the holiday period has reinforced market expectations for sustained high levels of defense expenditure.

Dual Catalysts: Taiwan Order and F-35 Funding

Two key financial developments served as primary catalysts for the equity's rise. On December 31, while markets were closed, Lockheed Martin was awarded a $328.5 million contract by the U.S. government. This package covers 55 state-of-the-art infrared sensor pods destined for Taiwan, with deliveries scheduled to be completed by June 2031. The designation of this procurement as an "urgent operational need" facilitates accelerated processes and the potential for faster revenue recognition.

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In a parallel and significant move, the Pentagon authorized approximately $1.7 billion in funding for the F-35 program. This financial release came even in the wake of a scrutinizing audit report that found only about 50 percent of the F-35 fleet to be mission-capable, a figure substantially below target. The billion-dollar disbursement is viewed as a clear signal of Washington's ongoing financial commitment to the program, despite intensified oversight and operational criticisms.

Technical and Fundamental Outlook

Closing at $497.07, Lockheed Martin's stock is now approaching the psychologically significant $500 threshold. A decisive break above this level would mark an end to the consolidation phase observed in the latter weeks of December and could pave the way for a test of new annual highs. Market participants are looking ahead to the company's fourth-quarter earnings report due in late January, where analysts are expected to pay close attention to margin trends within the F-35 program.