Key Points

• Lockheed Martin has been lagging other major defense contractor stocks.

• It is taking action to address underperforming aspects of its business.

• The stock's valuation is compelling and the dividend yield is generous.

• 10 stocks we like better than Lockheed Martin ›

Lockheed Martin (NYSE: LMT) shares fell a whopping 10.8% this past Tuesday in response to the defense contractor's second-quarter 2025 earnings and updated guidance. Lockheed badly missed analyst earnings estimates for the quarter due to a flurry of (mostly) one-time charges.

Despite the sell-off, here's why Lockheed is a no-brainer dividend stock to buy now.

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More losses for Lockheed Martin

Lockheed reported pre-tax losses on programs of $1.6 billion and other charges of $169 million, which dragged down its earnings per share (EPS) by $5.83 -- leading to net EPS of just $1.46. If program losses sound familiar, that's because Lockheed reported a similar quarter in January, when the stock fell 9.2% in a single session after Lockheed incurred $1.72 billion in write-offs.

The company does the vast majority of its business with the U.S. government, and to a lesser extent, approved allies. As such, investors can be left in the dark regarding classified national security programs. One-off charges usually don't impact a long-term investment thesis unless they signal prolonged challenges. Lockheed is testing investor patience because two out of its last three quarters drastically underperformed expectations due to one-off charges.

In its second-quarter press release, Lockheed attributed the program losses to its new review process, which is causing the company to reevaluate legacy programs and address associated risks. However, Lockheed believes that the review process is a necessary step to improve execution.

Results are still decent despite ongoing challenges

Lockheed Martin is a stodgy company with long-term contracts spanning fighter jets and other aircraft, missiles, weapons, combat systems, helicopters, space systems (primarily satellites), and more. Not every program is a high-margin cash cow. And that's been known in Lockheed's results for a while, given its slow growth. So while its program losses jump out in headline EPS figures, they are really just symptoms of a bigger problem.

Long-term investors would prefer a company address issues instead of letting them fester. But for now, Lockheed's stock is selling off while many of its peers are up big year to date and making all-time highs. To make matters worse, industrials have been the best-performing sector so far in 2025.

BA data by YCharts

Lockheed's underperformance in a hot sector is akin to a software company missing the boat on artificial intelligence. Earlier this year, Boeing beat Lockheed Martin for a major fighter jet contract that could be worth tens of billions of dollars over an extended period of time.

Growth at Lockheed has stagnated, as evidenced by a paltry 12% increase in revenue in the last five years and lower operating margins. Meanwhile, its peer, RTX, continues to generate solid organic growth. Northrop Grumman just hit an all-time high after beating earnings expectations and raising its full-year guidance.

It would be one thing if other major defense contractors were experiencing similar challenges as Lockheed, but this is far from the case. Lockheed isn't in a full-blown turnaround. Rather, it is addressing weaker areas of its business to return to growth.

The good news is that Lockheed is maintaining its full-year 2025 guidance for sales, cash from operations, capital expenses, free cash flow (FCF), and share repurchases -- illustrating that these changes aren't impacting its long-term investments or plans to return capital to shareholders.

Granted, Lockheed's low-single-digit revenue guidance and high-single-digit FCF guidance is far from exceptional. But it still has a healthy backlog to rely on to support its targets.

A value stock with a high yield

Lockheed isn't at the top of its game, but it is addressing program losses across its segments to improve its processes and operations going forward. In the meantime, the stock's dividend yield has pole-vaulted to the top of the industry. In fact, Lockheed is the only major defense contractor with a dividend yield above 2%.

LMT Dividend Yield data by YCharts

Lockheed's valuation will appear more expensive in the near term due to program losses dragging down EPS. But if the internal review leads to higher margins over time, the stock will look dirt cheap.

Management is guiding for 2025 sales of $73.75 billion to $74.75 billion and free cash flow of $6.6 billion to $6.8 billion. Based on the midpoint of those forecasts, and Lockheed's market capitalization of $96.2 billion at the time of this writing, the company would have a price-to-sales ratio of just 1.3 and a price-to-FCF ratio of 14.4.

For context, Lockheed's 10-year median is 1.7 for the P/S ratio and 19.2 for price-to-FCF ratio -- illustrating just how beaten-down the stock is right now. Lockheed arguably deserves to trade at a discount to its historical averages, given the company isn't delivering on shareholder expectations. However, the stock could be a great option for value investors who are willing to give the company time to recover.

Lockheed is a buy for patient investors

Unlike some one-off impairment charges, Lockheed's program charges are indicative of a larger issue at the company. Therefore, a sell-off was warranted. However, investing is more about where a company is going, rather than where it has been. And with Lockheed now beaten down, investors are getting an opportunity to scoop up shares at their lowest valuation in years.

Lockheed's discounted valuation and 3.2% dividend yield make it one of the best choices in the defense industry for value investors looking to boost their passive income. The mounting program losses quantify the extent of issues at the company, but at least Lockheed is ripping off the proverbial bandage and reviewing these issues rather than letting them persist.

Given Lockheed's diversified business model and strong cash flow, the stock appears to be a safe bet for income investors seeking to add stability to their passive income stream.

Should you invest $1,000 in Lockheed Martin right now?

Before you buy stock in Lockheed Martin, consider this:

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Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $636,628!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,063,471!*

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*Stock Advisor returns as of July 21, 2025

Daniel Foelber has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends L3Harris Technologies. The Motley Fool recommends Lockheed Martin and RTX. The Motley Fool has a disclosure policy.

Key Points

• SCHD and GCOW focus on higher-yielding dividend stocks.

• The ETFs have different strategies for selecting those stocks.

• They also have different fees and return profiles.

Many exchange-traded funds (ETFs) focus on holding dividend-paying stocks. While that gives income-seeking investors lots of options, it can make it difficult to know which is the best one to buy.

The Schwab U.S. Dividend Equity ETF (NYSEMKT: SCHD) and Pacer Global Cash Cows Dividend ETF (NYSEMKT: GCOW) are two notable dividend ETFs. Here's a look at which is the better one to buy for those seeking to generate passive income.

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Different strategies for selecting high-yielding dividend stocks

The Schwab U.S. Dividend Equity ETF and the Pacer Global Cash Cows Dividend ETF aim to provide their investors with above-average dividend income by holding higher-yielding dividend stocks. The ETFs each hold roughly 100 dividend stocks. However, they use different strategies to select their holdings.

The Schwab U.S. Dividend Equity ETF aims to track the returns of the Dow Jones U.S. Dividend 100 Index. That index screens U.S. dividend stocks based on four quality characteristics:

• Cash flow to debt.
• Return on equity (ROE).
• Indicated dividend yield.
• Five-year dividend growth rate.

The index selects companies that have stronger financial profiles than their peers. That should enable them to deliver sustainable and growing dividends, and the Schwab U.S. Dividend ETF accordingly provides investors with a higher-yielding current dividend that should grow at an above-average rate. At its annual reconstitution, its 100 holdings had an average dividend yield of 3.8% and a five-year dividend growth rate of 8.4%.

The Pacer Global Cash Cows Dividend ETF uses a different strategy for selecting its 100 high-yielding dividend stocks. It starts by screening the 1,000 stocks in the FTSE Developed Large-Cap Index for the 300 companies with the highest free cash flow yield over the past 12 months. It screens those stocks for the 100 highest dividend yields. It then weights those 100 companies in the fund from highest yield to lowest, capping its top holding at 2%. At its last rebalance, which it does twice a year, its 100 holdings had an average free cash flow yield of 6.3% and a dividend yield of 5%.

Here's a look at how the top holdings of these ETFs currently compare:

SCHD	GCOW
ConocoPhillips, 4.4%	Phillip Morris, 2.6%
Cisco Systems, 4.3%	Engie, 2.6%
Texas Instruments, 4.2%	British American Tobacco, 2.4%
Altria Group, 4.2%	Equinor, 2.2%
Coca-Cola, 4.1%	Gilead Sciences, 2.2%
Chevron, 4.1%	Nestle, 2.2%
Lockheed Martin, 4.1%	AT&T, 2.2%
Verizon, 4.1%	Novartis, 2.1%
Amgen, 3.8%	Shell, 2.1%
Home Depot, 3.8%	BP, 2%

Data sources: Schwab and Pacer.

Given their different strategies for selecting dividend stocks, the funds have very different holdings. SCHD holds only companies with headquarters in the U.S., while GCOW takes a global approach. U.S. stocks make up less than 25% of its holdings. Meanwhile, SCHD weights its holdings based on their dividend quality, while GCOW weights them based on dividend yield. Given its focus on yield, GCOW offers investors a higher current income yield at 4.2%, compared with 3.9% for SCHD.

Costs and returns

While SCHD and GCOW focus on higher-yielding dividend stocks, their strategies in selecting holdings have a major impact beyond the current dividend income. Because SCHD is a passively managed ETF while GCOW is an actively managed fund, SCHD has a much lower ETF expense ratio than GCOW. SCHD's is just 0.06%, compared with GCOW's 0.6%. Put another way, every $10,000 invested would incur $60 in management fees each year if invested in GCOW, compared with only $6 in SCHD.

GCOW's higher fee really eats into the income the fund generates, which affects its returns over the long term. The fund's current holdings actually have a 4.7% dividend yield, whereas the fund's latest payout had only a 4.2% implied yield.

ETF	1-Year	3-Year	5-Year	10-Year	Since Inception
GCOW	11.2%	8.4%	15.5%	N/A	8.8%
SCHD	3.8%	3.7%	12.2%	10.6%	12.2%

Data sources: Pacer and Schwab. Note: GCOW's inception date is 2/22/16, while SCHD's is 10/20/11.

GCOW has outperformed SCHD over the past five years. However, SCHD has delivered better performance over the longer term. That's due to its lower costs and focus on companies that grow their dividends, which tend to produce the highest total returns over the long term.

SCHD is a better ETF for passive income

SCHD and GCOW hold higher-yielding dividend stocks, making either ETF ideal for those seeking passive income. However, SCHD stands out as the better one to buy because of its focus on dividend sustainability and growth. It also has a much lower ETF expense ratio. So it should provide investors with an attractive and growing stream of passive dividend income.

Should you invest $1,000 in Schwab U.S. Dividend Equity ETF right now?

Before you buy stock in Schwab U.S. Dividend Equity ETF, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Schwab U.S. Dividend Equity ETF wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $692,914!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $963,866!*

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*Stock Advisor returns as of June 30, 2025

Matt DiLallo has positions in Chevron, Coca-Cola, ConocoPhillips, Gilead Sciences, Schwab U.S. Dividend Equity ETF, and Verizon Communications. The Motley Fool has positions in and recommends Amgen, Chevron, Cisco Systems, Gilead Sciences, and Texas Instruments. The Motley Fool recommends BP, British American Tobacco, Equinor Asa, Lockheed Martin, Nestlé, Philip Morris International, and Verizon Communications and recommends the following options: long January 2026 $40 calls on British American Tobacco and short January 2026 $40 puts on British American Tobacco. The Motley Fool has a disclosure policy.

Stock markets rallied Tuesday as a ceasefire between Israel and Iran appeared to be holding, just a couple of days after conflict seemed set to expand after a U.S. attack on an Iranian uranium enrichment site. In a social media post Tuesday morning, President Donald Trump said that "ISRAEL is not going to attack Iran. All planes will turn around and head home, while doing a friendly 'Plane Wave' to Iran. Nobody will be hurt, the Ceasefire is in effect!"

However, Lockheed Martin (NYSE: LMT) stock was falling as the rest of the market soared. At 3 p.m. ET, Lockheed stock was down 3%.

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Investors predict falling demand

Lockheed Martin makes weapons systems, both offensive and defensive. Demand rises in times of conflict and falls in more peaceful times. Two weeks ago, when the Israel-Iran conflict spiked with an attack on Iranian nuclear sites, Lockheed stock took off as investors bet on heightened demand for fighter jets and missile systems.

Two weeks later, as future demand for such military products comes into question, Lockheed Martin stock is giving back most of its gains, and, indeed, trading right about back where it was before recent events.

Is Lockheed Martin stock no longer a buy?

All this is logical, but also probably a wrong reaction to the ceasefire news. Granted, active conflict increases demand for weapons systems, in particular consumable weapons systems such as missiles, which, once fired, must be replaced. The theory is that the longer the conflict lasts, the greater the demand.

But, the current ceasefire notwithstanding, there will always be a need for the products Lockheed sells.

Should you invest $1,000 in Lockheed Martin right now?

Before you buy stock in Lockheed Martin, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Lockheed Martin wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $676,023!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $883,692!*

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See the 10 stocks »

*Stock Advisor returns as of June 23, 2025

Rich Smith has no position in any of the stocks mentioned. The Motley Fool recommends Lockheed Martin. The Motley Fool has a disclosure policy.

If everyone only invested in what they fully understood, I suspect quite a few stocks wouldn't exist today. We can probably put quantum computing stocks in that category. The quantum physics used by companies pioneering quantum computing can make your head spin.

Fortunately for many investors, quantum computing stocks do exist. Two of them have been especially big winners -- D-Wave Quantum (NYSE: QBTS) and IonQ (NYSE: IONQ). D-Wave Quantum has delivered the more impressive performance over the last 12 months. Is it a better quantum computing stock than IonQ?

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The case for D-Wave Quantum

Despite the market turbulence experienced in 2025, D-Wave Quantum has generated a staggering return of nearly 1,200% over the last 12 months. Even with this tremendous gain, though, the company's market cap remains below $5 billion.

D-Wave's financial performance has been impressive, too. The company's revenue soared 509% year over year in the first quarter of 2025. Its cash position totaled $304.3 million at the end of Q1. D-Wave's management believes that's enough to fund operations until the company achieves profitability.

The huge stock gains and strong revenue growth are the result of increasing interest in D-Wave's technology. The company boasts the world's largest quantum computer. D-Wave recently introduced its most advanced system to date, its sixth-generation Advantage2 quantum computer. CEO Alan Baratz said this new system is "so powerful that it can solve hard problems outside the reach of one of the world's largest exascale GPU-based classical supercomputers."

D-Wave has completed more than 20 proof-of-concept engagements over the last 18 months. Its customer base includes Deloitte, Fort Otosan (a Turkey-based automaker owned by Ford and Koç Holding), Lockheed Martin, and Japan Tobacco).

The case for IonQ

IonQ hasn't delivered the kind of gains that D-Wave has over the last 12 months, but it's nonetheless been sizzling hot. The quantum computing pioneer's stock is up roughly 380%. Thanks to this great return, IonQ's market cap now tops $9 billion.

At first glance, you might wonder about IonQ's growth. The company's revenue dipped slightly year over year in Q1. However, IonQ's revenue has increased by a compound annual growth rate of 170% since 2021. The company expects that 2025 revenue will nearly double year over year based on the midpoint of its guidance range.

IonQ believes that its ion trap architecture gives it distinct competitive advantages. Its quantum computers can operate at room temperature instead of requiring cooling to zero degrees Kelvin. The company thinks its error correction process is superior to rivals. IonQ also maintains that its architecture is more modular and scalable than the competition.

All three of the largest cloud platforms offer IonQ's quantum hardware, a claim no other quantum computing company can make. IonQ has a growing customer base that includes big companies such as Ansys, AstraZeneca, and Toyota Tsusho.

Better quantum computing stock?

Both D-Wave Quantum and IonQ could have tremendous growth potential. Quantum computing could transform many areas, including drug discovery, logistics, and materials science. Consulting firm McKinsey & Co. estimates that quantum computing and networking could create up to $880 billion in economic value by 2040.

However, these two companies also face significant risks. Neither D-Wave nor IonQ is profitable yet. Although their respective technological approaches show promise, the competition is intense, with some rivals possessing much greater financial resources.

If I had to pick one of these quantum computing stocks right now, I'd go with IonQ. It's generating more revenue than D-Wave. Its intellectual property portfolio is larger, with 950 patents related to quantum computing and networking that should soon be under the company's control.

I also like IonQ's business development strategy. Recent acquisitions of ID Quantique and Lightsynq position IonQ well in the quantum networking space.

Investing in IonQ isn't for everyone because of the inherent risks with a small company in a fledgling market. However, I think aggressive investors could see market-beating returns from this stock over the long run.

Should you invest $1,000 in IonQ right now?

Before you buy stock in IonQ, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and IonQ wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $669,517!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $868,615!*

Now, it’s worth noting Stock Advisor’s total average return is 792% — a market-crushing outperformance compared to 173% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

See the 10 stocks »

*Stock Advisor returns as of June 2, 2025

Keith Speights has no position in any of the stocks mentioned. The Motley Fool recommends Ansys, AstraZeneca Plc, and Lockheed Martin. The Motley Fool has a disclosure policy.

Lockheed Martin (NYSE: LMT) reported earnings on Tuesday, and the crowd went mild.

Seriously. Rarely has an earnings beat the size of the one Lockheed reported this week been met with such a gigantic collective shrug of dismissal as this one. Heading into earnings day, Wall Street analysts confidently predicted Lockheed would report a $6.31-per-share profit on $17.8 billion in sales. Instead, Lockheed reported $18 billion in sales, and a $7.28-per-share profit, a full 15% better than expected. But two days later, Lockheed Martin stock is still up less than a couple of percentage points.

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And I can't help but wonder why.

Lockheed Martin beat big in Q1 earnings (or did it?)

The most logical culprit for investors' underwhelming response to Lockheed's earnings beat is the fact that its sales didn't grow all that much year over year, rising just 4%. True, earnings grew 14% year over year as its gross profit margin improved markedly (to nearly 13%).

That said, the quality of Lockheed Martin's earnings seems suspect. While generally accepted accounting principles (GAAP) results certainly improved, the cash flow backing up those GAAP earnings didn't -- at all. Operating cash flow for the quarter was actually down year over year at just $1.4 billion, and free cash flow (FCF) declined significantly, from $1.3 billion in Q1 2024 to just $955 million in Q1 2025. Long story short, for every $1 in GAAP profit Lockheed says it earned, the actual cash profit it produced was only $0.56.

That's not a good number. (But read on -- it might get better.)

Going line by line at Lockheed Martin

Sales grew in three of Lockheed Martin's four main business segments, with space being the exception. Profit margins expanded in all four, with the company's missiles and fire control business throwing up the strongest numbers, $3.4 billion in sales at a 13.8% operating profit margin, up an astounding 340 basis points from a year ago.

The company's flagship aeronautics business (responsible for building F-16 fighter jets and F-35 stealth fighters) put up the weakest results. Sales grew a subpar 3% here, with profit margins showing both the smallest improvement year over year (just 30 basis points), and also the weakest absolute results of any division. Lockheed earned only 10.2% margins in aeronautics last quarter.

With aeronautics still Lockheed's biggest business segment, that doesn't bode well for future profits.

Lockheed Martin's full-year guidance

Speaking of the future, guidance may be another reason why investors aren't rewarding Lockheed much for its big earnings beat. According to management, 2025 revenue will range from $73.75 billion to $74.75 billion, so basically $74.25 billion at the midpoint, or very close to the $74.27 billion Wall Street consensus.

Earnings for the year, however, will fall short. Management anticipates profits of $27 to $27.30 per share. That makes the midpoint of the range $27.15, or $0.07 short of the consensus estimate of $27.22.

So Lockheed essentially told investors that, despite beating earnings by nearly $1 a share in Q1, it's not going to raise guidance for the full year by $1 a share. To the contrary, Lockheed is probably going to miss earnings later this year. Sure, the miss will be by only a few pennies. But the fact that Lockheed will miss at all has to concern investors.

Is Lockheed Martin stock a sell?

So that's the bad news. The good news is this: While profits may not be all investors hope for this year, free cash flow is looking likely to rebound strongly from Q1's underwhelming performance. Last year, Lockheed generated $5.3 billion in free cash flow, almost exactly equal to its reported net income of $5.3 billion. This year, Lockheed thinks it can generate anywhere from $6.6 billion to $6.8 billion -- much better than you might expect after Q1 FCF fell short of $1 billion.

Taken at the midpoint of $6.7 billion, that works out to free-cash-flow growth of 26%, a superb growth rate, and much stronger than the company's forecast for sales growth (just 4.5%).

Assuming Lockheed hits its free-cash-flow target, furthermore, the stock would be trading at only about 16.2 times current-year FCF. For a defense stock expected to grow profits at nearly 13% annually over the next five years, and paying a respectable 2.8% dividend yield, that's not expensive at all.

In fact, it just might be cheap enough to make Lockheed Martin stock a buy.

Should you invest $1,000 in Lockheed Martin right now?

Before you buy stock in Lockheed Martin, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Lockheed Martin wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $591,533!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $652,319!*

Now, it’s worth noting Stock Advisor’s total average return is 859% — a market-crushing outperformance compared to 158% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

See the 10 stocks »

*Stock Advisor returns as of April 21, 2025

Rich Smith has no position in any of the stocks mentioned. The Motley Fool recommends Lockheed Martin. The Motley Fool has a disclosure policy.

If you're a dividend investor, now can be an ideal time to go bargain-hunting. The stock market is in the midst of a broad sell-off, with investors dumping all types of stocks, both bad ones and good ones. Fear has taken over, and while it may seem like a terrible time to buy, it may actually be a great one, especially if you're looking for stocks to buy and hold for the long haul.

Three dividend stocks that are near their 52-week lows and which may make for solid income-generating investments are Pfizer (NYSE: PFE), Lockheed Martin (NYSE: LMT), and Rogers Communications (NYSE: RCI). Here's what you need to know about these stocks and why they are worth buying for their dividend income.

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Pfizer

One of the most attractive dividend yields you can find on the markets right now comes from Pfizer. At 7.5%, it's paying you more than five times the S&P 500 average of 1.4%. It's a mouthwatering payout, and the big question for investors comes down to whether it's safe or if it's too good to be true and due for a cut.

Based on the stock's more than 16% decline this year (as of Monday), investors don't appear convinced that Pfizer's dividend is safe, not with the new government potentially taking a tough stance on healthcare and vaccines in general.

The stock's payout ratio is more than 100%, which may also be concerning. But that's due to multiple one-time expenses, including asset impairment charges and restructuring costs. The healthcare company is expecting its top line to be fairly stable in 2025 and says it's on track to generate $4.5 billion in cost savings by the end of the year due to its Cost Realignment Program.

CEO Albert Bourla previously referred to the company's dividend as a "sacred cow," suggesting that it is an important priority to keep it going. While there will be some risk as Pfizer faces patent expirations on key products, it has been investing in developing and growing its pipeline of future drugs.

Pfizer is a bit of an underrated, contrarian pick that investors can get at an attractive valuation. Not only did it recently hit a new 52-week low, but it's also trading at less than 8 times its estimated future earnings (based on analyst expectations).

Lockheed Martin

Defense and aerospace stock Lockheed Martin makes for another solid, high-yielding option for investors to buy right now. Its dividend yield isn't as high as Pfizer's, but at over 3%, you're still getting a fairly attractive payout from the company.

While President Donald Trump has been vocal about cutting costs from government spending, he's also been a strong proponent of securing the country's borders and focusing on defense -- priorities that Lockheed Martin can benefit from. The company is expecting single-digit growth this year and for free cash flow to total at least $6.6 billion, up from $5.3 billion in 2024.

The stock's payout ratio is fairly modest at 57% of earnings, and with stable growth ahead, it looks like one of the safer income stocks to own right now. As of Monday, the stock was down 12% since the start of the year, but that may be primarily due to the broader market sell-off, as this still looks like a solid investment to buy and hold.

Rogers Communications

Canadian-based telecom giant Rogers Communications yields 5.4%. It is down 17% this year and hit a new 52-week low recently, but overall, its operations are stable, and historically, this has been a low-volatility stock to own. Concerns about the economy and high interest rates are weighing on the stock, but the company's fundamentals are strong.

Rogers has reported a profit totaling 1.7 billion Canadian dollars over the trailing 12 months, which is more than 8% of its top line (CA$20.6 billion). Its payout ratio of 63% is fairly modest and sustainable, even if it experiences a slowdown due to challenging economic conditions ahead.

Telecom stocks as a whole have been struggling in recent years, and Rogers' stock is trading at levels it hasn't been at since 2009. But as a top Canadian operator, there's little worry about its competitiveness and ability to generate strong results in the long run. This is a deep-value buy that investors shouldn't overlook.

Should you invest $1,000 in Pfizer right now?

Before you buy stock in Pfizer, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Pfizer wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $578,035!*

Stock Advisor provides investors with an easy-to-follow blueprint for success, including guidance on building a portfolio, regular updates from analysts, and two new stock picks each month. The Stock Advisor service has more than quadrupled the return of S&P 500 since 2002*. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

See the 10 stocks »

*Stock Advisor returns as of April 5, 2025

David Jagielski has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Pfizer. The Motley Fool recommends Lockheed Martin and Rogers Communications. The Motley Fool has a disclosure policy.