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Northrop Grumman Corp NOC Stock Quote

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Morningstar‘s Stock Analysis NOC

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Is it the right time to buy or sell?

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Capital Allocation


Northrop Grumman Has a Long Line of Revenue Visibility

Burkett Huey, CFA Equity Analyst

Business Strategy and Outlook

| David Whiston, CFA, CPA, CFE |

We view Northrop Grumman as a prime contractor that has exposure to younger development programs and one that has a greater focus on producing hardware for classified programs. The defense budget allocation is a political process, which is inherently difficult to predict, so we favor companies with tangible growth profiles through a steady stream of contract wins, ideally to contracts that are fulfilled over decades. And many programs are indeed procured and sustained over decades; for instance, the Ground Based Strategic Deterrent, for which Northrop was the only bidder, is intended to be deployed around 2029. Regulated margins, mature markets, customer-paid research and development, and long-term revenue visibility allow the defense primes to deliver a lot of cash to shareholders, which we view positively because we don’t see substantial growth in this industry.

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Key Statistics NOC

Company Profile NOC

Business Description

Northrop Grumman is a defense contractor that is diversified across short-cycle and long-cycle businesses. The firm’s segments include aeronautics, mission systems, defense services, and space systems. The company’s aerospace segment creates the fuselage for the massive F-35 program and produces various piloted and autonomous flight systems. Mission systems creates a variety of sensors and processors for defense hardware. The defense systems segment is a long-range missile manufacturer. Finally, the company’s space systems segment produces various space structures, sensors, and satellites.

2980 Fairview Park Drive
Falls Church, VA, 22042
T +1 703 280-2900
Industry Aerospace & Defense
Most Recent Earnings Jun 30, 2022
Fiscal Year End Dec 31, 2022
Employees 88,000

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