NORTHROP GRUMMAN CORP (NOC) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:NOC - US6668071029 - Common Stock
553.56 USD
+4.59 (+0.84%)
553.56 USD
0 (0%)
Taking everything into account, NOC scores 5 out of 10 in our fundamental rating. NOC was compared to 72 industry peers in the Aerospace & Defense industry. NOC has an excellent profitability rating, but there are concerns on its financial health. NOC has a correct valuation and a medium growth rate.
1. Profitability
1.1 Basic Checks
NOC had positive earnings in the past year.
NOC had a positive operating cash flow in the past year.
NOC had positive earnings in each of the past 5 years.
Each year in the past 5 years NOC had a positive operating cash flow.
1.2 Ratios
NOC has a better Return On Assets (8.15%) than 88.89% of its industry peers.
Looking at the Return On Equity, with a value of 25.14%, NOC belongs to the top of the industry, outperforming 93.06% of the companies in the same industry.
NOC's Return On Invested Capital of 9.57% is amongst the best of the industry. NOC outperforms 81.94% of its industry peers.
The Average Return On Invested Capital over the past 3 years for NOC is in line with the industry average of 8.58%.
The 3 year average ROIC (8.81%) for NOC is below the current ROIC(9.57%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 8.15% | ||
| ROE | 25.14% | ||
| ROIC | 9.57% |
ROA(3y)8.02%
ROA(5y)9.54%
ROE(3y)24.39%
ROE(5y)31.5%
ROIC(3y)8.81%
ROIC(5y)9.17%
1.3 Margins
NOC has a better Profit Margin (9.82%) than 79.17% of its industry peers.
NOC's Profit Margin has improved in the last couple of years.
Looking at the Operating Margin, with a value of 10.01%, NOC is in the better half of the industry, outperforming 61.11% of the companies in the same industry.
NOC's Operating Margin has declined in the last couple of years.
Looking at the Gross Margin, with a value of 19.42%, NOC is doing worse than 65.28% of the companies in the same industry.
NOC's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 10.01% | ||
| PM (TTM) | 9.82% | ||
| GM | 19.42% |
OM growth 3Y1.14%
OM growth 5Y-1.91%
PM growth 3Y-19.69%
PM growth 5Y8.9%
GM growth 3Y0%
GM growth 5Y-1.02%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so NOC is destroying value.
Compared to 1 year ago, NOC has less shares outstanding
The number of shares outstanding for NOC has been reduced compared to 5 years ago.
The debt/assets ratio for NOC is higher compared to a year ago.
2.2 Solvency
NOC has an Altman-Z score of 3.01. This indicates that NOC is financially healthy and has little risk of bankruptcy at the moment.
The Altman-Z score of NOC (3.01) is comparable to the rest of the industry.
The Debt to FCF ratio of NOC is 8.56, which is on the high side as it means it would take NOC, 8.56 years of fcf income to pay off all of its debts.
NOC's Debt to FCF ratio of 8.56 is in line compared to the rest of the industry. NOC outperforms 56.94% of its industry peers.
NOC has a Debt/Equity ratio of 0.95. This is a neutral value indicating NOC is somewhat dependend on debt financing.
NOC's Debt to Equity ratio of 0.95 is on the low side compared to the rest of the industry. NOC is outperformed by 76.39% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.95 | ||
| Debt/FCF | 8.56 | ||
| Altman-Z | 3.01 |
ROIC/WACC1
WACC9.6%
2.3 Liquidity
NOC has a Current Ratio of 1.11. This is a normal value and indicates that NOC is financially healthy and should not expect problems in meeting its short term obligations.
NOC has a worse Current ratio (1.11) than 86.11% of its industry peers.
A Quick Ratio of 0.98 indicates that NOC may have some problems paying its short term obligations.
NOC has a worse Quick ratio (0.98) than 73.61% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.11 | ||
| Quick Ratio | 0.98 |
3. Growth
3.1 Past
NOC shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 4.93%.
NOC shows a small growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 4.20% yearly.
Looking at the last year, NOC shows a decrease in Revenue. The Revenue has decreased by -0.14% in the last year.
The Revenue has been growing slightly by 3.93% on average over the past years.
EPS 1Y (TTM)4.93%
EPS 3Y0.58%
EPS 5Y4.2%
EPS Q2Q%9.57%
Revenue 1Y (TTM)-0.14%
Revenue growth 3Y4.78%
Revenue growth 5Y3.93%
Sales Q2Q%4.27%
3.2 Future
NOC is expected to show a small growth in Earnings Per Share. In the coming years, the EPS will grow by 7.69% yearly.
The Revenue is expected to grow by 4.28% on average over the next years.
EPS Next Y0.97%
EPS Next 2Y5.85%
EPS Next 3Y6.69%
EPS Next 5Y7.69%
Revenue Next Year1.35%
Revenue Next 2Y3.49%
Revenue Next 3Y4.09%
Revenue Next 5Y4.28%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
The Revenue growth rate is stable: in the next years the growth will be about the same than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 20.33 indicates a rather expensive valuation of NOC.
90.28% of the companies in the same industry are more expensive than NOC, based on the Price/Earnings ratio.
The average S&P500 Price/Earnings ratio is at 26.34. NOC is valued slightly cheaper when compared to this.
The Price/Forward Earnings ratio is 18.95, which indicates a rather expensive current valuation of NOC.
87.50% of the companies in the same industry are more expensive than NOC, based on the Price/Forward Earnings ratio.
When comparing the Price/Forward Earnings ratio of NOC to the average of the S&P500 Index (23.56), we can say NOC is valued inline with the index average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 20.33 | ||
| Fwd PE | 18.95 |
4.2 Price Multiples
80.56% of the companies in the same industry are more expensive than NOC, based on the Enterprise Value to EBITDA ratio.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of NOC indicates a somewhat cheap valuation: NOC is cheaper than 68.06% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 43.08 | ||
| EV/EBITDA | 16.63 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates NOC does not grow enough to justify the current Price/Earnings ratio.
The decent profitability rating of NOC may justify a higher PE ratio.
PEG (NY)20.94
PEG (5Y)4.84
EPS Next 2Y5.85%
EPS Next 3Y6.69%
5. Dividend
5.1 Amount
NOC has a Yearly Dividend Yield of 1.67%. Purely for dividend investing, there may be better candidates out there.
Compared to an average industry Dividend Yield of 1.12, NOC pays a better dividend. On top of this NOC pays more dividend than 91.67% of the companies listed in the same industry.
NOC's Dividend Yield is slightly below the S&P500 average, which is at 2.31.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.67% |
5.2 History
The dividend of NOC is nicely growing with an annual growth rate of 9.14%!
NOC has been paying a dividend for at least 10 years, so it has a reliable track record.
NOC has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)9.14%
Div Incr Years21
Div Non Decr Years34
5.3 Sustainability
31.43% of the earnings are spent on dividend by NOC. This is a low number and sustainable payout ratio.
The dividend of NOC is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP31.43%
EPS Next 2Y5.85%
EPS Next 3Y6.69%
553.56
+4.59 (+0.84%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryAerospace & Defense
Earnings (Last)
Earnings (Next)
Inst Owners83.46%
Inst Owner Change-10.19%
Ins Owners0.21%
Ins Owner Change-0.84%
Market Cap79.00B
Revenue(TTM)40.93B
Net Income(TTM)4.02B
Analysts74.81
Price Target677.53 (22.4%)
Short Float %1.23%
Short Ratio2.33
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.67% |
Yearly Dividend8.04
Dividend Growth(5Y)9.14%
DP31.43%
Div Incr Years21
Div Non Decr Years34
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)10.39%
Min EPS beat(2)3.14%
Max EPS beat(2)17.64%
EPS beat(4)2
Avg EPS beat(4)4.11%
Min EPS beat(4)-4.03%
Max EPS beat(4)17.64%
EPS beat(8)6
Avg EPS beat(8)6.48%
EPS beat(12)9
Avg EPS beat(12)6.36%
EPS beat(16)11
Avg EPS beat(16)4.78%
Revenue beat(2)1
Avg Revenue beat(2)-0.94%
Min Revenue beat(2)-3.68%
Max Revenue beat(2)1.8%
Revenue beat(4)1
Avg Revenue beat(4)-2.81%
Min Revenue beat(4)-5.46%
Max Revenue beat(4)1.8%
Revenue beat(8)4
Avg Revenue beat(8)-1.19%
Revenue beat(12)8
Avg Revenue beat(12)-0.32%
Revenue beat(16)8
Avg Revenue beat(16)-1.08%
PT rev (1m)1.15%
PT rev (3m)10.15%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-7.51%
EPS NY rev (1m)0%
EPS NY rev (3m)2.59%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-0.26%
Revenue NY rev (1m)-0.02%
Revenue NY rev (3m)-0.68%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 20.33 | ||
| Fwd PE | 18.95 | ||
| P/S | 1.93 | ||
| P/FCF | 43.08 | ||
| P/OCF | 22.98 | ||
| P/B | 4.94 | ||
| P/tB | N/A | ||
| EV/EBITDA | 16.63 |
EPS(TTM)27.23
EY4.92%
EPS(NY)29.21
Fwd EY5.28%
FCF(TTM)12.85
FCFY2.32%
OCF(TTM)24.09
OCFY4.35%
SpS286.77
BVpS112.02
TBVpS-11.69
PEG (NY)20.94
PEG (5Y)4.84
Graham Number261.98
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 8.15% | ||
| ROE | 25.14% | ||
| ROCE | 11.2% | ||
| ROIC | 9.57% | ||
| ROICexc | 10.11% | ||
| ROICexgc | 20.63% | ||
| OM | 10.01% | ||
| PM (TTM) | 9.82% | ||
| GM | 19.42% | ||
| FCFM | 4.48% |
ROA(3y)8.02%
ROA(5y)9.54%
ROE(3y)24.39%
ROE(5y)31.5%
ROIC(3y)8.81%
ROIC(5y)9.17%
ROICexc(3y)9.79%
ROICexc(5y)10.31%
ROICexgc(3y)23.55%
ROICexgc(5y)25.56%
ROCE(3y)10.31%
ROCE(5y)10.74%
ROICexgc growth 3Y1.23%
ROICexgc growth 5Y-4.1%
ROICexc growth 3Y4.4%
ROICexc growth 5Y0.96%
OM growth 3Y1.14%
OM growth 5Y-1.91%
PM growth 3Y-19.69%
PM growth 5Y8.9%
GM growth 3Y0%
GM growth 5Y-1.02%
F-Score6
Asset Turnover0.83
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.95 | ||
| Debt/FCF | 8.56 | ||
| Debt/EBITDA | 2.72 | ||
| Cap/Depr | 108.38% | ||
| Cap/Sales | 3.92% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 61.64% | ||
| Profit Quality | 45.63% | ||
| Current Ratio | 1.11 | ||
| Quick Ratio | 0.98 | ||
| Altman-Z | 3.01 |
F-Score6
WACC9.6%
ROIC/WACC1
Cap/Depr(3y)122.86%
Cap/Depr(5y)118.97%
Cap/Sales(3y)4.25%
Cap/Sales(5y)4.11%
Profit Quality(3y)64.96%
Profit Quality(5y)63.21%
High Growth Momentum
Growth
EPS 1Y (TTM)4.93%
EPS 3Y0.58%
EPS 5Y4.2%
EPS Q2Q%9.57%
EPS Next Y0.97%
EPS Next 2Y5.85%
EPS Next 3Y6.69%
EPS Next 5Y7.69%
Revenue 1Y (TTM)-0.14%
Revenue growth 3Y4.78%
Revenue growth 5Y3.93%
Sales Q2Q%4.27%
Revenue Next Year1.35%
Revenue Next 2Y3.49%
Revenue Next 3Y4.09%
Revenue Next 5Y4.28%
EBIT growth 1Y41.9%
EBIT growth 3Y5.98%
EBIT growth 5Y1.94%
EBIT Next Year33.46%
EBIT Next 3Y15.32%
EBIT Next 5Y10.2%
FCF growth 1Y-12.33%
FCF growth 3Y6.79%
FCF growth 5Y-2.88%
OCF growth 1Y-6.98%
OCF growth 3Y7.15%
OCF growth 5Y0.42%
NORTHROP GRUMMAN CORP / NOC FAQ
What is the fundamental rating for NOC stock?
ChartMill assigns a fundamental rating of 5 / 10 to NOC.
Can you provide the valuation status for NORTHROP GRUMMAN CORP?
ChartMill assigns a valuation rating of 5 / 10 to NORTHROP GRUMMAN CORP (NOC). This can be considered as Fairly Valued.
Can you provide the profitability details for NORTHROP GRUMMAN CORP?
NORTHROP GRUMMAN CORP (NOC) has a profitability rating of 7 / 10.
What is the valuation of NORTHROP GRUMMAN CORP based on its PE and PB ratios?
The Price/Earnings (PE) ratio for NORTHROP GRUMMAN CORP (NOC) is 20.33 and the Price/Book (PB) ratio is 4.94.
What is the financial health of NORTHROP GRUMMAN CORP (NOC) stock?
The financial health rating of NORTHROP GRUMMAN CORP (NOC) is 3 / 10.