Lockheed Martin F-35C Lightning II planes.
Support Element West / Lockheed Martin
Shares of the defense giant
were falling Wednesday after a Bloomberg report that the U.S. government will buy fewer F-35 jet fighters in fiscal 2023. The size of the cut looks small, but investors are selling anyway, perhaps due to other factors.
Lockheed shares (ticker: LMT) were falling 6.8% to $418.27. The
Dow Jones Industrial Average
were up 1.3% and 0.9%, respectively.
About 33 planes seem to be responsible for the majority of the daily drop. That’s the number of planes that are being cut from the U.S. defense budget for 2023, according to Bloomberg.
“It is premature to speculate about the proposed defense budget prior to its release,” said a Lockheed spokesman when asked about the budget. “The F-35 is the most lethal, survivable and connected fighter in the world today, and is strengthening our allies, deterring our enemies, and bolstering our economy.”
Overall, the U.S. military has ordered some 2,400 F-35 jets. The armed forces of other countries have ordered another 900. Lockheed had delivered about 750 as of the end of 2021.
It looks as if demand for F-35 jets should continue far into the future, but the budget cuts could still affect Lockheed’s 2022 financial results. (The government’s fiscal 2023 starts in October 2022).
Currently, Lockheed has told investors to expect about $66 billion in sales for 2022, along with about $6 billion in free cash flow and $26.70 in per-share earnings. Wall Street projections now line…