Lockheed Martin LMT and L3Harris Technologies LHX stand out as important suppliers to the U.S. military and allied nations. While both companies benefit from rising global defense spending, they offer different investment opportunities based on their business mix, growth prospects and valuation.
Lockheed Martin is one of the world's largest defense contractors and generates a significant portion of its revenues from major weapons platforms, such as the F-35 fighter jet, missile defense systems, military helicopters and space programs. As geopolitical tensions continue to drive demand for advanced missile systems and military modernization, Lockheed Martin is well positioned to benefit.
L3Harris, on the other hand, is more focused on communications systems, electronic warfare, intelligence, surveillance, reconnaissance technologies, and advanced defense electronics. Following its merger and subsequent acquisitions, the company has expanded its capabilities across multiple defense domains.
Let's compare the stocks' fundamentals to determine which one is better positioned at present.
Factors Acting in Favor of LMT Stock
The F-35 remains a central franchise program for Lockheed Martin’s Aeronautics segment, combining production, upgrades and long-duration sustainment work. The program represented about 27% of consolidated sales in the first quarter of 2026, and Aeronautics sales were partially supported by higher F-35 sustainment volume even as other aircraft programs faced timing headwinds. During the first quarter of 2026, the company secured a contract for long-lead items for future lots, which signals continued partner commitment and helps de-risk near-term production planning.
The company indicated that the current U.S. budget rollout reflects priorities such as accelerating munitions production, strengthening integrated air and missile defense, advancing next-generation aircraft and expanding space capabilities. These areas align closely with the company’s core platforms across PAC-3, THAAD and PrSM, as well as fighter and strategic programs. LMT has also signed multiyear framework agreements with the Department of War to scale munitions production and is planning investments across more than 20 new or modernized facilities, which can improve capacity planning and reduce supply-chain bottlenecks over time.
Factors Acting in Favor of LHX Stock
L3Harris’ space sensing and missile franchises remain aligned with priorities such as Golden Dome, missile defense and hypersonic tracking. In first-quarter 2026, the company delivered 1.4x book-to-bill on $7.8 billion of orders and grew backlog to a record $40.7 billion, which can support program ramps across the portfolio.
The company continues to benefit from increased international deliveries, including growth in international software-defined resilient communications and higher maritime program volume driven by program timing. Contract awards highlighted in the first quarter 2026 earnings materials included about $725 million tied to an international airborne early warning and control program and about $450 million of international software-defined resilient communications. This mix can diversify program cadence and support longer-run demand for communications, sensors and mission systems.
How Do Zacks Estimates Compare for LMT & LHX?
The Zacks Consensus Estimate for Lockheed Martin’s 2026 earnings per share (EPS) indicates a decrease of 0.30% over the past 60 days. LMT’s long-term (three to five years) earnings growth rate is 18.48%.
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The Zacks Consensus Estimate for L3Harris’ 2026 EPS indicates an increase of 0.17% over the past 60 days. LHX’s long-term earnings growth rate is 17.17%.
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Valuation for LMT & LHX
Lockheed Martin shares trade at a forward 12-month Price/Sales (P/S F12M) of 1.44X compared with L3Harris’ 2.25X.
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Debt Position of LMT & LHX
Currently, Lockheed Martin’s total debt-to-capital is 73.43% compared with L3Harris’ 35.87%.
LMT & LHX’s Price Performance
In the past year, shares of Lockheed Martin have increased 9.3%, while those of L3Harris have risen 19.1%.
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LMT or LHX: Which Is a Better Choice Now?
The F-35 program remains a cornerstone of Lockheed Martin’s business, supported by ongoing production, upgrades, sustainment activities, and continued customer commitment to future orders. LMT is also benefiting from defense priorities focused on missile systems, next-generation aircraft, and space capabilities, while expanding manufacturing capacity to support long-term growth and improve supply-chain efficiency.
L3Harris is well positioned to benefit from growing demand for missile defense, space sensing, and advanced tracking technologies, supported by a strong order pipeline and expanding backlog. LHX is also seeing momentum from international defense programs, particularly in resilient communications, surveillance, and maritime systems, which can help drive sustained growth and diversify its revenue base.
Our choice at the moment is L3Harris, given its better price performance, strong earnings growth and better debt management than Lockheed Martin. Both LMT and LHX carry a Zacks Rank #3 (Hold) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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Lockheed Martin Corporation (LMT): Free Stock Analysis Report
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This article originally published on Zacks Investment Research (zacks.com).