Lockheed Martin Corp. (LMT), the largest US defense contractor, inaugurated its new facilities in Newtown, Pa, after completing its $24 million expansion program. The expansion program included addition of a conference center and new manufacturing capabilities to the facility.
 
Lockheed Martin expanded its satellite manufacturing capabilities through the 18,800-square-feet high bay addition at the west end of the facility’s Product Team Building. Also, the company added a 15,000-square-foot conference center named Patriot Center, to enable large scale meetings.
 
The Newtown facility is part of Space Systems Company, an operating unit of Lockheed Martin. Space System Company provides advanced-technology systems to governmental bodies and commercial customers. The Newtown facility also serves as a headquarters for Lockheed Martin Commercial Space Systems, the U.S. Air Force’s GPS III Space Segment program and NOAA’s Geostationary Operational Environmental Satellite R-Series (GOES-R) program.
 
Lockheed Martin is the largest provider of IT services, systems integration, and training to the U.S. Government. Apart from serving the Department of Defense and other federal agencies, the company derives its business from international government and from commercial sales of its products, services and platforms.
 
The future prospects of Lockheed Martin, to a large extent, depend upon defense spending. The U.S defense department expressed its intention to cut down on defense spending and save $100 billion over the next five years. Such cost cuts will impact the future prospects not only of Lockheed Martin but also that of other defense contractors. Prime competitors of the company include Boeing Co. (BA), Northrop Grumman Corp. (NOC) and Raytheon Co. (RTN).
 
We currently maintain a Neutral recommendation on the stock.
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