Lockheed Martin (LMT) shares tanked nearly 10% on Tuesday morning after the aerospace and defense manufacturer came in miles below EPS estimates for its fiscal Q2. 

The company based out of Fort Worth, Texas earned $1.46 a share in its second financial quarter, well below $6.41 per share that analysts had forecast. 

Including today’s decline, Lockheed Martin stock is down some 17% versus its year-to-date high. 

Why Did Lockheed Martin Fall Short of Earnings Estimates in Q2?

LMT missed estimates by a huge margin in its fiscal Q2 due to an unexpected $1.6 billion charge. 

About $950 million of it was tied to a classified aeronautics program facing design, integration, and testing setbacks that worsened in the first half of 2025. 

The remaining $570 million hit came from revised cost estimates on the firm’s Canadian Maritime Helicopter Program, driven by expanded mission requirements and ongoing contract restructuring.

Investors should note, however, that both of these charges were described as one-time adjustments in Lockheed Martin’s earnings release on Tuesday. 

Therefore, it’s well within reason to argue that the selloff in LMT shares today is rather overblown and the defense stock is, in fact, worth buying on the post-earnings weakness. 

Why Are LMT Shares Worth Buying Despite Q2 Earnings Miss?

Investors should consider loading up on Lockheed Martin shares at current levels also because the NYSE-listed firm, despite falling short of Q2 earnings expectations, reaffirmed its full-year outlook for sales and free cash flow on Tuesday, signaling confidence in its operational outlook. 

Additionally, the aerospace and defence manufacturer remains committed to repurchasing roughly $3 billion worth of its stock this year – which may boost shareholder value in the second half of 2025. 

In the earnings release, Jim Taiclet, the company’s chief executive officer, remained optimistic as well, citing increased global interest in defense systems like THAAD, PAC-3, and F-35. 

Note that LMT stock currently pays a healthy dividend yield of 3.13%, which makes it all the more exciting to buying on the post-earnings pullback. 

Wall Street Remains Positive on Lockheed Martin Stock

Despite the earnings miss, Wall Street firms also remain largely bullish on Lockheed Martin stock. 

The consensus rating on LMT shares remains at “Moderate Buy” with the mean target of nearly $523 indicating potential upside of some 25% from here.