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Defense Stock Facing Resistance Ahead of Earnings

The security is heading for its first loss in six sessions

Digital Content Manager
Apr 15, 2025 at 12:27 PM
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Aerospace and defense giant Lockheed Martin Corp (NYSE:LMT) will announce first-quarter results before the open on Tuesday, April 22. Analysts anticipate quarterly profits of $6.42 per share and revenue of $17.76 billion, or year-over-year growth of about 1.4% and 3.3%, respectively.

LMT was last seen down 0.4% to trade at 473.46, on track to snap a five-day win streak. Though the security is fresh off its best weekly performance since July, the $480 region is once again acting as a ceiling after capping rallies in early and late March. The 120-day moving is also moving in as resistance, and over the last six months, the shares shed nearly 22%.

LMT 100 Day

Lockheed Martin stock doesn't have the best post-earnings track record. The security closed lower after five of its last eight quarterly reports, including back-to-back losses of 9.2% and 6.1% in January and October, respectively. Over the last two year, the shares averaged a 3.9% next-day swing, regardless of direction, which is lower than the 5.2% move the options pits are pricing in this time around. 

Options traders lean firmly bullish toward LMT, and a negative post-earnings reaction could lead to an unwinding of optimism. This is per the stock's 50-day call/put volume ratio of 3.81 over at the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), which ranks higher than 87% of readings from the past year.

It's worth noting the stock has a history of exceeding volatility expectations, making it a solid pick for premium buyers. Its Schaeffer’s Volatility Scorecard (SVS) sits at 95 out of 100, indicating the equity has consistently delivered bigger moves than options traders predicted.

 

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