NYSE:NOC

Stock Analysis Report

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Market Cap

US$58.1b

Last Updated

2021/07/31 05:28 UTC

Data Sources

Company Financials +

Share Price & News

How has Northrop Grumman's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: NOC is less volatile than 75% of US stocks over the past 3 months, typically moving +/- 2% a week.

Volatility Over Time: NOC's weekly volatility (2%) has been stable over the past year.


Market Performance


7 Day Return

0.5%

NOC

0.3%

US Aerospace & Defense

-0.5%

US Market


1 Year Return

11.7%

NOC

29.0%

US Aerospace & Defense

35.9%

US Market

Return vs Industry: NOC underperformed the US Aerospace & Defense industry which returned 29% over the past year.

Return vs Market: NOC underperformed the US Market which returned 35.9% over the past year.


Shareholder returns

NOCIndustryMarket
7 Day0.5%0.3%-0.5%
30 Day-1.3%-0.4%0.3%
90 Day2.4%1.5%3.1%
1 Year13.7%11.7%31.7%29.0%38.0%35.9%
3 Year28.4%22.1%23.1%-2.5%62.9%52.7%
5 Year79.5%65.8%72.4%29.3%121.7%97.3%

Long-Term Price Volatility Vs. Market

How volatile is Northrop Grumman's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Northrop Grumman undervalued compared to its fair value and its price relative to the market?

26.9%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: NOC ($363.02) is trading below our estimate of fair value ($496.31)

Significantly Below Fair Value: NOC is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: NOC is good value based on its PE Ratio (13.1x) compared to the US Aerospace & Defense industry average (30.1x).

PE vs Market: NOC is good value based on its PE Ratio (13.1x) compared to the US market (18x).


Price to Earnings Growth Ratio

PEG Ratio: NOC's earnings are forecast to decline next year, so we can't calculate its PEG ratio.


Price to Book Ratio

PB vs Industry: NOC is overvalued based on its PB Ratio (5.2x) compared to the US Aerospace & Defense industry average (2.6x).


Future Growth

How is Northrop Grumman forecast to perform in the next 1 to 3 years based on estimates from 16 analysts?

-2.6%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: NOC's earnings are forecast to decline over the next 3 years (-2.6% per year).

Earnings vs Market: NOC's earnings are forecast to decline over the next 3 years (-2.6% per year).

High Growth Earnings: NOC's earnings are forecast to decline over the next 3 years.

Revenue vs Market: NOC's revenue (4.8% per year) is forecast to grow slower than the US market (9.2% per year).

High Growth Revenue: NOC's revenue (4.8% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: NOC's Return on Equity is forecast to be high in 3 years time (30.8%)


Past Performance

How has Northrop Grumman performed over the past 5 years?

9.6%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: NOC has a large one-off gain of $1.9B impacting its June 30 2021 financial results.

Growing Profit Margin: NOC's current net profit margins (12.1%) are higher than last year (6.9%).


Past Earnings Growth Analysis

Earnings Trend: NOC's earnings have grown by 9.6% per year over the past 5 years.

Accelerating Growth: NOC's earnings growth over the past year (89.7%) exceeds its 5-year average (9.6% per year).

Earnings vs Industry: NOC earnings growth over the past year (89.7%) exceeded the Aerospace & Defense industry -10.1%.


Return on Equity

High ROE: Whilst NOC's Return on Equity (40.71%) is outstanding, this metric is skewed due to their high level of debt.


Financial Health

How is Northrop Grumman's financial position?


Financial Position Analysis

Short Term Liabilities: NOC's short term assets ($12.8B) exceed its short term liabilities ($8.6B).

Long Term Liabilities: NOC's short term assets ($12.8B) do not cover its long term liabilities ($22.4B).


Debt to Equity History and Analysis

Debt Level: NOC's debt to equity ratio (111.9%) is considered high.

Reducing Debt: NOC's debt to equity ratio has reduced from 112.5% to 111.9% over the past 5 years.

Debt Coverage: NOC's debt is well covered by operating cash flow (31.4%).

Interest Coverage: NOC's interest payments on its debt are well covered by EBIT (7.1x coverage).


Balance Sheet


Dividend

What is Northrop Grumman current dividend yield, its reliability and sustainability?

1.73%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: NOC's dividend (1.73%) is higher than the bottom 25% of dividend payers in the US market (1.31%).

High Dividend: NOC's dividend (1.73%) is low compared to the top 25% of dividend payers in the US market (3.54%).


Stability and Growth of Payments

Stable Dividend: NOC's dividends per share have been stable in the past 10 years.

Growing Dividend: NOC's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its low payout ratio (21.4%), NOC's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: NOC's dividends in 3 years are forecast to be well covered by earnings (24.6% payout ratio).


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

2.5yrs

Average management tenure


CEO

Kathy Warden (49 yo)

2.5yrs

Tenure

US$20,807,144

Compensation

Ms. Kathy J. Warden has been President of Northrop Grumman Corporation since January 1, 2018, Chief Executive Officer since January 1, 2019 and Chairman of the Board August 1, 2019. Ms. Warden served as th...


CEO Compensation Analysis

Compensation vs Market: Kathy's total compensation ($USD20.81M) is above average for companies of similar size in the US market ($USD11.17M).

Compensation vs Earnings: Kathy's compensation has been consistent with company performance over the past year.


Leadership Team

Experienced Management: NOC's management team is considered experienced (2.5 years average tenure).


Board Members

Experienced Board: NOC's board of directors are considered experienced (7.8 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

Northrop Grumman Corporation's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Northrop Grumman Corporation
  • Ticker: NOC
  • Exchange: NYSE
  • Founded: 1939
  • Industry: Aerospace and Defense
  • Sector: Capital Goods
  • Market Cap: US$58.123b
  • Shares outstanding: 160.11m
  • Website: https://www.northropgrumman.com

Number of Employees


Location

  • Northrop Grumman Corporation
  • 2980 Fairview Park Drive
  • Falls Church
  • Virginia
  • 22042
  • United States

Listings


Biography

Northrop Grumman Corporation operates as an aerospace and defense company worldwide. The company operates through four segments: Aeronautics Systems, Defense Systems, Mission Systems, and Space Systems. Th...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2021/07/31 05:28
End of Day Share Price2021/07/30 00:00
Earnings2021/06/30
Annual Earnings2020/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.