📈 Northrop Grumman Corporation (NYSE:NOC), a defense industry powerhouse, showcases a 35-year record with over 15,000% in total returns. Despite recent market volatility, its market cap remains around $76 billion, with shares generating a solid 13.71% annual return over the past decade. Known for resilience, NOC has overcome numerous challenges. What awaits investors now?
💰 Northrop Grumman recently boosted earnings per share and increased dividends by 10.2%, highlighting its commitment to shareholders. With a current yield of 1.58% and consistent dividend growth, NOC maintains a low payout ratio, supporting future dividend increases. This financial flexibility enhances its long-term potential for rewarding shareholders.
📊 Over the last year, Northrop Grumman’s return on invested capital (ROIC) fell to 5.9% from a high of 16.5% in 2021, showing fluctuations in performance. Revenue per share has grown 9.42% annually, though gross profit margins recently dipped below 20%, signaling a need for improvement. Restoring these margins is a priority as the company seeks to strengthen its metrics.
📈 In Q3, NOC posted earnings per share of $7.00, exceeding estimates by $0.94. Quarterly revenue reached $10 billion, with standout results: Mission Systems saw a 7% increase, and Aeronautics Systems revenue rose by 4%. While Space Systems’ revenue dropped 3%, its operating income surged 14%, indicating efficiency improvements even amid sales decreases.
📉 Valuation models suggest Northrop Grumman trades at a 14% discount to fair value, with potential long-term growth of 34.12%. Considering dividend yield, fair value adjustments, and EPS growth, NOC could offer strong returns. The question remains: will it hit these growth targets? NOC currently offers a compelling opportunity for investors seeking stability and growth potential.
What do you think about it? Tag me on your favourite social media (Facebook / Instagram / LinkedIn / Reddit / X).
P.S. I research and interview economists, NZ investors and profitable companies to find tools & tactics that you can use to achieve financial freedom.
➔ Join my private newsletter to be the first one to learn insider tips! Here are examples of what you’ll get. It’s FREE. You can unsubscribe at any time. I treat your email as my top secret.
IMPORTANT: This article is of general nature only and readers should obtain advice specific to their circumstances from professional advisers.