Lockheed Martin (LMT) DIvidends Date & History

Key Takeaways

• Dividend yield: LMT currently offers a dividend yield of roughly 2.6%, well above many of its defense-industry peers.
• Dividend growth streak: Lockheed Martin has increased its dividend for 22 consecutive years, with a roughly 6% average annual increase over the past five years.
• Payment schedule: The company pays a quarterly dividend of $3.45 per share, or $13.80 annually.
• Payout ratio: The payout ratio sits near 50% of trailing earnings and below 40% of operating cash flow, suggesting a sustainable dividend.
• Investor appeal: LMT combines a moderate yield with a long record of steady payout increases, making it attractive to dividend growth investors.

Dividend Overview

Lockheed Martin Corporation (LMT), one of the world's largest aerospace and defense contractors, maintains a well-established dividend policy. The company pays a quarterly dividend of $3.45 per share, equivalent to $13.80 per share on an annualized basis. At recent share prices, this translates to a dividend yield of approximately 2.6%, which is modest relative to traditional high-yield income stocks but meaningful within the defense sector.

Lockheed Martin is best characterized as a dividend growth stock rather than a high-yield stock. The company prioritizes consistent, predictable annual increases over maximizing current income. With a payout that is both reliable and growing, LMT appeals to investors seeking a blend of current income and long-term compounding, supported by a backlog of defense contracts that underpins revenue stability.

Dividend History and Growth

Lockheed Martin has a strong record of returning capital to shareholders. The company has increased its dividend for 22 consecutive years, a streak that places it among the more dependable dividend payers in the industrial and defense space. Over the past five years, the dividend has grown at an average annual rate of approximately 6.4%.

Total dividends per share have climbed steadily from $9.00 in 2019 to $13.35 in 2025, reflecting management's commitment to regular increases. The most recent change was a $0.15 per share increase announced in October 2025, lifting the quarterly payout from $3.30 to $3.45. This disciplined, incremental approach is typical of Lockheed Martin's long-term strategy: prioritize modest, sustainable growth in the dividend rather than large, one-off hikes that could strain cash flow.

Dividend Sustainability and Payout Ratio

The dividend appears sustainable based on current financial metrics. Lockheed Martin's payout ratio is approximately 50% of trailing earnings, a level that leaves meaningful room to absorb earnings fluctuations. Measured against operating cash flow, the payout is even more conservative at roughly 39%, indicating the dividend is well covered by the cash the business actually generates.

It is worth noting that Lockheed Martin's earnings-based payout ratio has shown volatility in recent periods due to non-cash accounting charges, which can temporarily distort earnings per share (EPS). Despite these swings, the cash-flow-based coverage has remained stable, reinforcing the dividend's durability. The company also maintains a strong balance sheet and a substantial defense backlog, providing financial stability that supports continued dividend payments and future increases.

Dividend Compared to Industry Peers

Within the aerospace and defense industry, Lockheed Martin's dividend stands out as relatively generous. Boeing (BA) suspended its dividend entirely and has yet to reinstate it. Northrop Grumman (NOC) currently yields roughly 1.6%, while General Dynamics (GD) and RTX (RTX) offer yields in the low-2% range. By comparison, LMT's approximate 2.6% yield is among the highest of the large-cap defense primes.

This higher yield, combined with a two-decade growth streak, gives Lockheed Martin a distinctive profile: it offers more current income than most peers while still delivering consistent annual payout increases, an uncommon combination in the sector.

AI Screener

Tickeron's AI Screener is an AI-powered stock and ETF discovery tool that helps traders and investors filter the market based on technical patterns, fundamentals, trends, volatility, and AI-driven signals. Users can scan thousands of stocks and ETFs using customizable filters such as industry, market capitalization, technical indicators, price patterns, and performance metrics. The screener is particularly useful for identifying dividend stocks, income-focused investments, trending names, and breakout candidates far more efficiently than manual screening. To explore dividend opportunities and streamline your research, visit the AI Screener.

Is This Stock Attractive for Dividend Investors?

Lockheed Martin is likely most appealing to dividend growth investors and long-term, income-oriented investors who value predictability over maximum current yield. The company's 22-year streak of dividend increases, disciplined payout ratio, and cash-flow coverage make it a candidate for investors seeking compounding income over time. Its roughly 2.6% yield also offers a modest but dependable income stream that compares favorably with defense-sector peers.

For pure high-yield investors, LMT may be less compelling, as its yield remains below that of traditional income-focused sectors such as utilities or consumer staples. Conservative investors may appreciate the company's strong balance sheet and defense backlog, which support payment stability. However, earnings can be affected by contract timing and accounting charges, so the dividend growth trajectory should be viewed as steady rather than aggressive. As always, individual goals, time horizon, and risk tolerance should guide any decision, and this analysis should not be treated as investment advice.

Disclaimer

The information on this webpage is provided for general informational and educational purposes only and is not intended as investment advice, a recommendation to purchase or sell any security, or an offer or solicitation related to investments. It does not consider your personal financial situation, goals, or risk profile, and all investing carries inherent risks, including the possibility of losing your entire investment. For more details, please review our full disclaimer.

Disclaimers and Limitations