• Lockheed Martin is a Dividend Contender with 17 consecutive years of dividend growth. Shares, currently, yield 2.43%.
• Examining Lockheed Martin's cash flow and balance sheet.
• Lockheed Martin is attractively valued with a high likelihood of generating 10%+ IRRs.

Lockheed Martin (LMT) is the best-of-breed when it comes to the defense industry. Lockheed is a leader in the development and manufacture of missiles, helicopters, and jets for the defense industry.

Lockheed Martin is one of the companies that I estimated was undervalued back in late 2012. While it appears to have been the case, I, unfortunately, didn't follow through on that decision by trying to get too cute with the valuation. Since then, the share price has outperformed the S&P 500 by roughly 2.3x.

Data by YCharts

Dividend History

When I began investing, the dividend growth strategy appealed most to me. Part of that was due to its simplicity: focus on quality businesses, buy at reasonable valuations, and ignore the noise in the day-to-day stock price movements. I've had some duds following this strategy, but I've had plenty of big winners over time as well. A history of growing dividends isn't fool-proof in preventing you from picking losers; however, I do think it helps to weed out some of the potential missteps that can occur when picking less established businesses.

Image by author; data source Lockheed Martin Investor Relations

According to the CCC list, Lockheed Martin is a Dividend Contender with 17 consecutive years of dividend growth.

During Lockheed Martin's dividend growth streak, year over year raises have ranged from 6.7% to 56.9% with an average of 18.5% and a median of 15.2%.

Expanding that out to the 13 rolling 5-year periods and annualized dividend growth has ranged from 9.3% to 25.8% with an average of 17.6% and a median of 18.6%.

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