We're Locking in Big Gains on These Two Holdings
While we see further upside potential, we’re being prudent and locking in some big gains.
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| Symbol | Transaction Type | # Shares Added | Recent Price $ | Shares Owned After Trade | % Portfolio |
|---|---|---|---|---|---|
AXON | Sell | 63 | $419.50 | 380 | 3.4% |
LMT | Sell | 27 | $606.50 | 220 | 2.85% |
After you receive this alert, the Portfolio will make the following trades:
- Sell 63 shares of Axon AXON at or near $419.50. Following the trade, the Portfolio will own 380 AXON shares, roughly 3.4% of the Portfolio.
- Sell 27 shares of Lockheed Martin LMT at or near $606.50. Following the trade, the Portfolio will own 220 LMT shares, roughly 2.85% of the Portfolio.
We are following up on our opening comments from Monday, ringing the register and locking in some substantial gains in both AXON and LMT shares. Over the last several weeks, both have easily trounced the S&P 500, helping lift the overall Portfolio higher. However, their pronounced level of outperformance also means both shares are in overbought territory, which is leading us to take some prudent action.
We will continue to hold sizable positions in both AXON and LMT shares. Our reasoning for that stems from the potential for further price target revisions higher in the coming weeks.
Last week, Lockheed upsized both its quarterly dividend and share-buyback program, something we think speaks to the cash generation we’ll see as its multi-year backlog is converted into booked revenue. The big catalyst we, and many others, are likely waiting for when it comes to LMT shares is the company’s updated multiyear delivery schedule, in part to gauge F-35 shipment expectations. What we learn may lead to revisiting our LMT price target, even after lifting it to $625 last week.
With Axon, the key to revising our price target higher once again for those shares will largely hinge on margin potential as the company’s mix shift continues to move toward the higher-margin, recurring revenue cloud business.
We’ve been focused on that for some time when it comes to Axon, and that will remain our guiding light, even with public safety continuing to receive bipartisan support. Axon should continue to expand its customer base both domestically and internationally with TASERs, body cameras and other hardware products driving the cloud business.
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(Please note that we are looking to execute these trades at or near the share price mentioned above. Once the trade is completed, subscribers can see the trade's executed price here. Be sure to click on Closed Trade Gain/Loss and toggle the chart to sort by Purchase Date.)
At the time of publication, TheStreet Pro Portfolio was long AXON and LMT.
