Lockheed, Boeing Gain Despite Sequester Fears
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Even as Lockheed Martin chairman Robert Stevens warns of mass layoffs if sequestration hits, his company has been doing remarkably well this year, with revenue up 6 percent this quarter and earnings up 26 percent, according to an analysis by Motley Fool’s Rich Smith.
Boeing has done even better, with 58 percent earnings growth, thanks largely to its commercial aircraft sales. Raytheon basically stayed even on revenue but gained 17 percent on earnings, while General Dynamics and Northrop Grumman declined on both measures. Smith called Northrop’s problems puzzling, given its strong position in unmanned aerial vehicles (although its Block 30 Global Hawk faces cancellation) and its undervalued price-to-earnings ratio.
While sequestration may already be having a chilling effect on investment and on small business, the axe has yet to fall for the biggest defense companies. At least the mainstream press is beginning to pay attention to the story.
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