We're Boosting Our Price Targets for These 2 Financial Positions

* We are increasing our price targets for Morgan Stanley our Bank of America.

* Lockheed Martin nabs another big contract, building its all-important backlog figure.

While we wait for today’s economic calendar to jumpstart a busy data week, we are boosting our price target for Morgan Stanley MS to $110 from $105 and for Bank of America BAC to $43 from $41. These moves follow the announced dividend increases from these two companies after Friday’s market close, but also reflect the improving outlook for the IPO market and M&A activity. You’ll recall we expected these announcements following the successful completion of the Fed’s latest round of bank stress tests.

Specifically:

Morgan Stanley announced it will increase its quarterly stock dividend by 8.8% to $0.925 per share from the prior $0.85 per share. The firm's Board of Directors also reauthorized a multi-year common equity share repurchase program of up to $20 billion, without a set expiration date, beginning in the third quarter of 2024.

Bank of America boosted its quarterly dividend by 8% to $0.26 per share.

While we are making these adjustments, should investment banking activity heat up further in the coming quarters, it would give us reason to revisit these targets yet again. Once the record and payment dates are announced for these new dividends, we’ll be sure to share them with you.

Lockheed Martin Nabs Another Big Contract Win

Last week, Lockheed Martin LMT was awarded a $2 billion contract from the U.S. Air Force and U.S. Navy, and early this morning the company received a $5.28 billion contract for Phased Array Tracking Radar to Intercept on Target Advanced Capability-3. The duration of the contract is expected to run through June 2027.

These wins and others should lead us to see a nice uptick in Lockheed’s backlog when it reports its June-quarter results. That will clearly be a positive for the stock, but the catalyst we and the market are waiting for is the resumption of F-35 deliveries. Word on that timing will be the focal point of the upcoming earnings conference call in the coming weeks.

While we wait for that date to be announced, be sure to mark your calendars for September 27, which is when Lockheed will pay its next quarterly dividend of $3.15 per share to shareholders of record as of September 3.

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At the time of publication, TheStreet Pro Portfolio was long MS, BAC and LMT.