Northrop Grumman logged a -1.1% change during today's morning session, and is now trading at a price of $454.5 per share.
Over the last year, Northrop Grumman logged a -4.6% change, with its stock price reaching a high of $496.89 and a low of $414.56. Over the same period, the stock underperformed the S&P 500 index by -31.3%. AThe company's 50-day average price was $456.98. Northrop Grumman Corporation operates as an aerospace and defense technology company in the United States, Asia/Pacific, Europe, and internationally. Based in Falls Church, VA, the Large-Cap Industrials company has 101,000 full time employees. Northrop Grumman has offered a 1.6% dividend yield over the last 12 months.
Increasing Revenues but Narrowing Margins:
| 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | |
|---|---|---|---|---|---|---|
| Revenue (M) | $30,095 | $33,841 | $36,799 | $35,667 | $36,602 | $39,290 |
| Operating Margins | 13% | 12% | 11% | 16% | 10% | 6% |
| Net Margins | 11% | 7% | 9% | 20% | 13% | 5% |
| Net Income (M) | $3,229 | $2,248 | $3,189 | $7,005 | $4,896 | $2,056 |
| Net Interest Expense (M) | $562 | $528 | $593 | $556 | $506 | $545 |
| Depreciation & Amort. (M) | $800 | $1,265 | $1,267 | $1,239 | $1,342 | $1,338 |
| Diluted Shares (M) | 173 | 168 | 167 | 161 | 156 | 152 |
| Earnings Per Share | $18.49 | $13.22 | $19.03 | $43.54 | $31.47 | $13.53 |
| EPS Growth | n/a | -28.5% | 43.95% | 128.8% | -27.72% | -57.01% |
| Avg. Price | $286.99 | $299.74 | $310.92 | $338.69 | $429.64 | $454.5 |
| P/E Ratio | 15.44 | 22.57 | 16.3 | 7.75 | 13.59 | 33.49 |
| CAPEX (M) | $1,249 | $1,264 | $1,420 | $1,415 | $1,435 | $1,775 |
| EV / EBITDA | 16.63 | 14.17 | 14.34 | 11.39 | 18.04 | 24.28 |
| Total Debt (M) | $27,766 | $25,540 | $29,264 | $25,560 | $24,682 | $27,642 |
| Net Debt / EBITDA | 5.72 | 4.45 | 4.57 | 3.2 | 4.47 | 6.33 |
| Current Ratio | 1.17 | 1.13 | 1.6 | 1.3 | 1.08 | 1.15 |
Northrop Grumman has weak operating margins with a negative growth trend, declining EPS growth, and a highly leveraged balance sheet. On the other hand, the company has rapidly growing revenues and increasing reinvestment in the business working in its favor. Furthermore, Northrop Grumman has just enough current assets to cover current liabilities, as shown by its current ratio of 1.15.
Northrop Grumman's Valuation Is in Line With Its Sector Averages:
Northrop Grumman has a trailing twelve month P/E ratio of 33.8, compared to an average of 22.19 for the Industrials sector. Based on its EPS guidance of $27.61, the company has a forward P/E ratio of 16.6. The 5.9% compound average growth rate of Northrop Grumman's historical and projected earnings per share yields a PEG ratio of 5.73. This suggests that these shares are overvalued. Furthermore, Northrop Grumman is likely overvalued compared to the book value of its equity, since its P/B ratio of 4.61 is higher than the sector average of 4.06. The company's shares are currently trading 164.0% below their Graham number.
Northrop Grumman Has an Analyst Consensus of Some Upside Potential:
The 20 analysts following Northrop Grumman have set target prices ranging from $385.0 to $615.0 per share, for an average of $489.74 with a hold rating. The company is trading -7.2% away from its average target price, indicating that there is an analyst consensus of some upside potential.
Northrop Grumman has a very low short interest because 1.3% of the company's shares are sold short. Institutions own 85.1% of the company's shares, and the insider ownership rate stands at 0.24%, suggesting a small amount of insider investors. The largest shareholder is State Street Corporation, whose 9% stake in the company is worth $6,297,031,597.
