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Lockheed Stock Just Sank $12. This Is Why. - Barron's

1. Lockheed Martin stock dropped $12 amid investor conference comments. 2. CFO disclosed potential delays for critical F-35 Lot 18 award. 3. Possible combination of Lots 18 and 19 may delay revenue recognition. 4. Investor sentiment worsened by Elon Musk’s criticism of the F-35 program. 5. Lockheed stock has fallen 16% since the November presidential election.

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FAQ

Why Bearish?

Delays in the F-35 contract can lead to income uncertainty. Historical delays in defense contracts have correlated with stock downturns.

How important is it?

The announcement about potential delays significantly influences earnings expectations. As the F-35 makes up a substantial revenue portion, it can heavily affect investor outlook.

Why Short Term?

The effects of production delays are immediate, impacting quarterly estimates. Investors usually react quickly to contract-related news.

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