/Northrop%20Grumman%20Corp_%20website%20magnified-by%20Casimiro%20PT%20via%20Shutterstock.jpg)
Northrop Grumman Corporation (NOC), headquartered in Falls Church, Virginia, specializes in aerospace, defense, and security solutions for various industry applications. Valued at $62.71 billion by market cap, the company provides systems, products, and solutions in aerospace, electronics, information systems, and technical services to government and commercial customers worldwide. The aerospace and defense major is expected to announce its fiscal second-quarter earnings for 2024 before the market opens on Thursday, July 25.
Ahead of the event, analysts expect NOC to report a profit of $5.98 per share on a diluted basis, up 12% from $5.34 per share in the year-ago quarter. The company has consistently surpassed Wall Street’s EPS estimates in its last four quarterly reports. In the previous quarter, NOC reported revenues of $10.13 billion, up 8.9% year over year, outperforming analysts' expectations by 3.8%. It was a stunning quarter for the company.
For the full year, analysts expect NOC to report EPS of $24.70, up 6.1% from $23.29 in fiscal 2023.
NOC stock has underperformed the S&P 500’s ($SPX) 26.8% gains over the past 52 weeks, with shares down 6.3% during this period. Similarly, it underperformed the S&P 500 Industrial Sector SPDR’s (XLI) 12.2% gains over the same time frame.
On Jun. 21, NOC shares fell more than 1% after research firm Bernstein downgraded the stock to Market Perform from Outperform.
On Apr. 25, NOC reported its Q1 results. It reported an EPS of $6.32 that topped Wall Street expectations of $5.83. The company posted a revenue of $10.13 billion, exceeding Wall Street forecasts of $9.78 billion. NOC expects full-year EPS to be between $24.45 and $24.85 and revenue to be between $40.8 billion and $41.2 billion. NOC shares closed up more than 2% on the day the results were released but have been on a downtrend since then.
NOC’s relative underperformance can be attributed to the loss of a major U.S. missile contract worth $17 billion to rival Lockheed Martin Corporation (LMT) and cost overruns on the first lot of B-21 raiders due to higher-than-expected production costs and economic disruptions.
The consensus opinion on NOC stock is bullish, with a “Moderate Buy” rating overall. Out of 18 analysts covering the stock, six advise a “Strong Buy” rating, 10 give a “Hold” rating, and two recommend a “Strong Sell.” The average analyst price target for NOC is $503, indicating a potential upside of 18.7% from the current levels.
On the date of publication, Dipanjan Banchur did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
