YCHARTS DIVIDEND DAILY: Military Spending Dividend: Lockheed’s Payout, Yielding 4.6% and Well-Covered

Lockheed Martin Dividend Chart by YCharts

Yes, the Pentagon is under pressure to cut the defense budget, and the winding down of two wars would seem to argue against defense stocks. But remember: a Republican in the White House would likely maintain weapons programs at a high level; and Democrats, including Obama, are typically desperate not to be seen as peace-niks. Lockheed Martin’s (LMT) $46.5 billion in 2011 revenue is well-diversified across defense programs. Its cash from operations of $4.3 billion is nearly four times the $1.1 billion annual Lockheed dividend payout. Pension funding has been a drag on cash flow. And Lockheed spends heavily to repurchase shares -- $2.4 billion in 2011 alone. The PE is about 11 on trailing earnings.