Shares of defense contractor Lockheed Martin whipsawed on Tuesday, witnessing a steep decline during the regular session, before mounting a recovery overnight.

Under the agreement, Lockheed Martin will support necessary investments to scale production, while both the company and the government will share in cost savings enabled by the long-term commitment. The company has already increased PAC-3 MSE production by more than 60% over the past two years, delivering 620 units in 2025.

Priced at $4.2 million per unit currently, PAC-3 MSE is a $2.5 billion franchise for Lockheed Martin at present. Although it seems implied that the increased production rates will yield lower prices for the customer, if one were to triple the production rate and hold the price constant, for example, that would grow to $8.4 billion annually.

Analyst Rationale Truist noted that the firm's expanding global orders and capacity growth are expected to accelerate key segments, particularly in missiles and fire control, which could generate double-digit growth over the coming year,

Defense stocks such as Lockheed and Northrup, are in the spotlight after Trump's buyback threats and $1.5 trillion budget proposal.

Lockheed Martin ( LMT +3.81%) stock gained for a second straight day Friday, rising 4.2% through 11:50 a.m. ET after Truist Securities analyst Michael Ciarmoli upgraded the defense giant to buy with a $605 price target, as StreetInsider.com reports.

Detailed price information for Lockheed Martin Corp (LMT-N) from The Globe and Mail including charting and trades.