We’re Buying More of This Oversold One-Rated Stock
The recent sell-off brings a great risk-to-reward opportunity in a growing market.
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| Symbol | Transaction Type | # Shares Traded | Recent Price $ | Shares Owned After Trade | % Portfolio |
|---|---|---|---|---|---|
LMT | Buy | 40 | $548 | 290 | 3.25% |
After you receive this alert, we will buy 40 shares of Lockheed Martin LMT at or near $548. Following the trade, the Portfolio will own 290 LMT shares, roughly 3.25% of the Portfolio.
After Lockheed Martin reported its September quarter results, which included record backlog, we boosted our price target to $650, upgraded the shares to a One rating and added to the Portfolio’s holdings. Since that trade on October 23, LMT shares have continued to move lower, bringing their total post-earnings decline to around 11%. That move also has landed the shares in oversold territory based on their relative strength index level of about 29.
As we can see in the chart above, when LMT shares cross into that, it tends to offer a smart opportunity to pick up some shares. With rising F35 production and the company working off a record backlog, it should continue to benefit from rising international defense spending and the need to re-arm U.S. defense stockpiles. The latter is captured in the following:
“The U.S. has not developed a defense industrial base intended for a large-scale war of attrition in both Europe and the Middle East, while meeting its own readiness standards,” said Elias Yousif, a fellow and deputy director of the Conventional Defense Program at the Stimson Center in Washington. “And both of those wars are extended conflicts, which was not part of the U.S. defense planning.”
More Pro Portfolio
- We're Adding Shares and Upping Our Price Target on This Holding Amid Record Backlog
- Weekly Roundup: Multiple Points of Confirmation for Our Portfolio Positioning
- AI Generates News: A Look at the Headlines That Speak to Our Stocks
(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 LMT.
