Lockheed Martin’s (NYSE:LMT) multi-year growth outlook is facing serious headwinds following a wave of unexpected charges and operational setbacks, prompting Truist Securities to downgrade the defense giant from Buy to Hold.

Lockheed Martin Corp. caught investors off guard with $1.6 billion in charges and a possible tax hit that sent its stock tumbling, the latest setback for the defense giant whose popular F-35 jet faces criticism over cost overruns and delays.

Lockheed Martin faces Wall Street pressure after mixed Q2 results and $1.6B in charges. Goldman Sachs analyst reiterates Sell rating and lowers price forecast. Other analysts also cautious. Margins hit by legacy program charges.

Lockheed Martin reported on Tuesday that its second-quarter profit plunged by about 80%, after the U.S. defense group recorded a pretax loss of $1.6 billion, mainly linked to a classified program within its Aeronautics segment,

The company also cut its 2025 operating profit outlook by $1.5 billion to $6.65 billion. The charge included $950 million related to the undisclosed program and $570 million connected to issues with Canada's CH-148 Cyclone helicopter deal.

I maintain a bullish stance on the defense sector, and I'm bullish on both RTX as well as Lockheed Martin (LMT). See why RTX takes the crown in this matchup.