Northrop Grumman Exceeds Earnings Expectations Amidst Tough Defense Sector
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 4 days ago
0mins
Should l Buy NOC?
Source: Fool
- Strong Earnings Report: Northrop Grumman reported an adjusted earnings per share of $7.23 in Q4, surpassing analyst expectations of $6.96, with GAAP earnings reaching $9.99, demonstrating robust profitability amidst a challenging defense market.
- Significant Sales Growth: The company achieved quarterly sales of $11.7 billion, reflecting a 10% year-over-year increase, while total annual sales were $42 billion, growing only 2%, indicating Northrop's superior performance in a competitive landscape.
- Substantial Free Cash Flow Increase: Free cash flow surged by 84% to $2.2 billion in Q4, with annual free cash flow at $3.3 billion, although lower than the reported net profit of $4.2 billion, showcasing effective cash management that enhances future investment capacity.
- Cautious Outlook: Despite reporting a record backlog of $95.7 billion, management forecasts approximately 4% sales growth in 2026 and adjusted earnings of about $27.65 per share, both falling short of analyst expectations, reflecting uncertainty in future growth that may impact investor confidence.
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Analyst Views on NOC
Wall Street analysts forecast NOC stock price to fall
13 Analyst Rating
10 Buy
3 Hold
0 Sell
Strong Buy
Current: 695.060
Low
630.00
Averages
684.08
High
770.00
Current: 695.060
Low
630.00
Averages
684.08
High
770.00
About NOC
Northrop Grumman Corporation is a global aerospace and defense technology company. Its segments include Aeronautics Systems, Defense Systems, Mission Systems, and Space Systems. Aeronautics Systems is engaged in the design, development, production, integration, sustainment and modernization of military aircraft systems for the United States Air Force, the United States Navy, other United States government agencies, and international customers. Defense Systems is engaged in the design, engineering, development, integration, and manufacturing of deterrent systems, advanced tactical weapons, and missile defense solutions. Mission Systems is a provider of mission solutions and multifunction systems. Its products and services include command, control, communications and computers, and reconnaissance (C4ISR) systems. Space Systems delivers end-to-end mission solutions through the design, development, integration, production and operation of space, missile defense, and launch systems.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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