► Prefer to read?: https://dividendsandincome.com/2021/04/08/lockheed-martin-lmt/ ► Subscribe for new videos every day!: http://bit.ly/dai_youtube ► Dave Van Knapp's Top 30 Dividend Growth Stocks for 2021: https://DaveVanKnapp.com/ ► Dave Van Knapp's Dividend Growth Portfolio: https://dailytradealert.com/dave-van-knapps-dividend-growth-portfolio/ ► Jason Fieber's Stock Portfolio + BUY and SELL alerts: https://patreon.com/jasonfieber In this series, High Quality Dividend Growth Stock of the Month, I cover really great companies. To identify them, I use my Quality Snapshot grading system. In a nutshell, here’s how the system works. First, I research ratings and grades from sources that I have come to trust and respect over the years: Safety and Financial Strength grades from Value Line S&P’s Credit Rating Morningstar's Moat Rating Simply Safe Dividends' Dividend Safety Grade That gives me five factors that address, each in their own way, company quality. Then, because the sources use different grading scales and systems, I assign points to their various approaches that let me unify the different rating systems into a single system. Lockheed Martin's Dividend Record Lockheed Martin, possibly one of the best stocks to buy now, yields 2.8%, which is toward the lower end of what I consider mid-range (2-4%). Its 5-year dividend growth rate has been 10% per year, which is fast. That combination of yield and growth makes LMT a mid-yield, fast-growth DG stock. Lockheed Martin’s dividend record is good. I give it a “B.” LMT’s yield – at 2.8% -- is a mid-range yield. While 2.8% is not super-high, that is balanced by its fast growth rate, which has averaged 10% per year over the past 5 years. LMT’s dividend safety score of 84 points on Simply Safe Dividends’ scale of 0-100 is in the top tier of SSD’s scores. It means that LMT’s dividend is very safe and unlikely to be cut. The aggregate assessment is that LMT undervalued, with a valuation ratio of 0.86. Using that ratio, it is easy to calculate a fair price: Fair price = current price / valuation ratio. Lockheed Martin’s recent price is about $371. Using the formula for fair price, we get $371 / 0.86 = $431. All valuations are estimates about the future. Therefore, it is logical to think in ranges rather than precise values. I regard any price within +/- 10% of my calculated fair price to be “fair.” If I apply that 10% cushion to LMT, that puts the top of its buying range at $475. Obviously, with LMT currently trading so far below its fair price, there is no need to even think about its maximum buy price. A good time to buy it is right now. I own Lockheed Martin in my Dividend Growth Investing Portfolio. In fact, I have been building up my position since late last year. As an accumulator of the stock, LMT’s dead-money era and lack of upward price movement over the past three years is fine with me. FOLLOW US: ► Website: http://www.dividendsandincome.com/ ► YouTube: http://bit.ly/dai_youtube ► Patreon: http://bit.ly/dai_patreon #DaveVanKnapp #DividendGrowthPortfolio #DividendGrowthInvesting LEGAL DISCLAIMER: Please consult with a licensed investment professional before investing any of your money. Never invest in a security or idea featured on this channel unless you can afford to lose your entire investment. If your money is not FDIC insured, it may decline in value. Dave is not a licensed financial advisor, tax professional, or stockbroker and he does not purport to be. Links above may include affiliate commissions paid to the owners of Dividends and Income and help support this channel.