Morgan Stanley Upgrades LMT to Overweight as Analysts Pile In

Lockheed Martin gained 15.9% over the past week, leaving its closest defense peers well behind: RTX added 2.8%, NOC rose 10.7%, and LHX gained 6.7%. The gap widened further on Monday, with LMT up another 5.1% to $635.20 as analyst upgrades continued to stack up.

Five Firms Raise Targets in Four Days

Morgan Stanley's Kristine Liwag moved to Overweight from Equal-Weight on October 26, lifting her target to $835 from $690. That implies 31% upside from current levels and stands as the most bullish published target on the stock. JP Morgan's Seth Seifman maintained Neutral the same day but raised his target to $665 from $620. The day before, Citigroup lifted to $706, UBS to $692, and RBC Capital to $600. All five followed Q3 results released October 22, when the stock moved 9.6% on the day.

The consensus rating remains Hold, with 12 Hold ratings against 2 Outperform. The mean target across the analyst panel sits at $645. That gap between the consensus target and Morgan Stanley's $835 is unusually wide, reflecting a genuine split on how much credit to give the Q3 beat and the 10-year F-35 framework agreement.

The bull case rests on a $292 billion backlog, Q3 revenue up 11% to $20.7 billion, EPS of $7.97 against a $7.52 consensus, and mid-teens MFC segment growth expected over five years. The bear case centres on limited free cash flow growth, F-35 programme dependency, and the loss of several next-generation platform competitions.

Options Market Shifts Hard Toward Calls

The put/call ratio dropped to 0.7598 on October 26, the lowest reading in more than two standard deviations below the 20-day mean of 0.80. The 52-week range runs from 0.47 to 1.04. Before last week, the ratio had been holding in a narrow band around 0.80 to 0.84 for most of September and early October. The post-earnings break lower reflects a material rotation into calls relative to that recent pattern, consistent with the scale of the stock's move and the tone of the analyst commentary.

Borrow Market Stays Loose

Short interest sits at 1.18% of the free float, little changed over the past week and broadly consistent with levels documented in prior notes. Availability remains exceptionally wide at 8,948% of short interest, meaning there is no friction in the lending market. The cost to borrow has risen roughly 23% over the past month to 0.45%, but at that level it carries no practical weight. The stock's 15.9% weekly move owes nothing to a short squeeze.

Data Summary

• Price: $635.20, up 15.9% over the past week, up 22.3% over the past month
• Morgan Stanley target: $835 (Overweight); consensus mean target: $645
• Put/call ratio: 0.76, 2.4 standard deviations below the 20-day mean
• Short interest: 1.18% of free float, down slightly on the week
• Availability: 8,948% of short interest; cost to borrow: 0.45%
• Next earnings: January 26, 2027

The price that would change the analyst picture is whether the stock closes above the mean consensus target of $645, which would leave the majority of the panel with targets below the market price and force a round of revisions.