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Baird analysts downgraded Lockheed Martin (NYSE:LMT) to Neutral from Outperform in a note to clients Wednesday, maintaining a $513 price target on the stock.
They told investors in a note that the firm expects some mixed first-quarter reports reflecting noise in defense outlooks on supply chain, margin pressure, and R&D amortization.
They revealed that while LMT’s 2023 guide is intact, they are downgrading the stock as it is within 3% of their price target, and they remain concerned about growth and margins going forward.
“Following strong gains of the LMT stock of nearly 40% in 2022 and flat YTD performance that is within 3% of our price target warrants some caution at current levels especially given concerns on margins,” the analysts wrote.
“Given LMT’s overall growth concerns and lack of margin expansion over the next several quarters, we believe it’s more prudent to move to the sidelines with a Neutral rating, especially following the strong outperformance in 2022.”
