NORTHROP GRUMMAN CORP (NOC) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:NOC - US6668071029 - Common Stock
577.01 USD
-33.6 (-5.5%)
609 USD
+31.99 (+5.54%)
We assign a fundamental rating of 5 out of 10 to NOC. NOC was compared to 71 industry peers in the Aerospace & Defense industry. While NOC belongs to the best of the industry regarding profitability, there are concerns on its financial health. NOC has a correct valuation and a medium growth rate. Finally NOC also has an excellent dividend rating.
1. Profitability
1.1 Basic Checks
NOC had positive earnings in the past year.
In the past year NOC had a positive cash flow from operations.
Each year in the past 5 years NOC has been profitable.
In the past 5 years NOC always reported a positive cash flow from operatings.
1.2 Ratios
NOC has a better Return On Assets (8.15%) than 88.73% of its industry peers.
NOC's Return On Equity of 25.14% is amongst the best of the industry. NOC outperforms 92.96% of its industry peers.
The Return On Invested Capital of NOC (9.57%) is better than 81.69% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for NOC is in line with the industry average of 8.63%.
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
With a decent Profit Margin value of 9.82%, NOC is doing good in the industry, outperforming 78.87% of the companies in the same industry.
NOC's Profit Margin has improved in the last couple of years.
With a decent Operating Margin value of 10.01%, NOC is doing good in the industry, outperforming 60.56% of the companies in the same industry.
NOC's Operating Margin has declined in the last couple of years.
NOC has a Gross Margin of 19.42%. This is in the lower half of the industry: NOC underperforms 64.79% of its industry peers.
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
NOC has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
Compared to 1 year ago, NOC has less shares outstanding
Compared to 5 years ago, NOC has less shares outstanding
Compared to 1 year ago, NOC has a worse debt to assets ratio.
2.2 Solvency
An Altman-Z score of 3.16 indicates that NOC is not in any danger for bankruptcy at the moment.
NOC has a Altman-Z score (3.16) which is in line with its industry peers.
NOC has a debt to FCF ratio of 8.56. This is a slightly negative value and a sign of low solvency as NOC would need 8.56 years to pay back of 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 54.93% 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.
Looking at the Debt to Equity ratio, with a value of 0.95, NOC is doing worse than 74.65% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.95 | ||
| Debt/FCF | 8.56 | ||
| Altman-Z | 3.16 |
ROIC/WACC0.95
WACC10.03%
2.3 Liquidity
A Current Ratio of 1.11 indicates that NOC should not have too much problems paying its short term obligations.
NOC's Current ratio of 1.11 is on the low side compared to the rest of the industry. NOC is outperformed by 85.92% of its industry peers.
NOC has a Quick Ratio of 1.11. This is a bad value and indicates that NOC is not financially healthy enough and could expect problems in meeting its short term obligations.
NOC has a worse Quick ratio (0.98) than 73.24% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.11 | ||
| Quick Ratio | 0.98 |
3. Growth
3.1 Past
The Earnings Per Share has been growing slightly by 4.93% over the past year.
Measured over the past 5 years, NOC shows a small growth in Earnings Per Share. The EPS has been growing by 4.20% on average per year.
NOC shows a decrease in Revenue. In the last year, the revenue decreased by -0.14%.
NOC shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 3.93% yearly.
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
The Earnings Per Share is expected to grow by 7.69% on average over the next years.
Based on estimates for the next years, NOC will show a small growth in Revenue. The Revenue will grow by 4.28% on average per year.
EPS Next Y0.91%
EPS Next 2Y5.77%
EPS Next 3Y6.79%
EPS Next 5Y7.69%
Revenue Next Year1.33%
Revenue Next 2Y3.47%
Revenue Next 3Y4.1%
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.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
4. Valuation
4.1 Price/Earnings Ratio
NOC is valuated rather expensively with a Price/Earnings ratio of 21.19.
91.55% of the companies in the same industry are more expensive than NOC, based on the Price/Earnings ratio.
When comparing the Price/Earnings ratio of NOC to the average of the S&P500 Index (26.92), we can say NOC is valued slightly cheaper.
With a Price/Forward Earnings ratio of 19.78, NOC is valued on the expensive side.
Based on the Price/Forward Earnings ratio, NOC is valued cheaper than 90.14% of the companies in the same industry.
When comparing the Price/Forward Earnings ratio of NOC to the average of the S&P500 Index (23.57), we can say NOC is valued inline with the index average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 21.19 | ||
| Fwd PE | 19.78 |
4.2 Price Multiples
NOC's Enterprise Value to EBITDA ratio is rather cheap when compared to the industry. NOC is cheaper than 80.28% of the companies in the same industry.
NOC's Price/Free Cash Flow ratio is a bit cheaper when compared to the industry. NOC is cheaper than 67.61% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 44.9 | ||
| EV/EBITDA | 18.09 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
NOC has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)23.28
PEG (5Y)5.04
EPS Next 2Y5.77%
EPS Next 3Y6.79%
5. Dividend
5.1 Amount
NOC has a Yearly Dividend Yield of 1.62%. Purely for dividend investing, there may be better candidates out there.
NOC's Dividend Yield is rather good when compared to the industry average which is at 0.39. NOC pays more dividend than 91.55% of the companies in the same industry.
NOC's Dividend Yield is comparable with the S&P500 average which is at 1.94.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.62% |
5.2 History
On average, the dividend of NOC grows each year by 9.14%, which is quite nice.
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
NOC pays out 31.43% of its income as dividend. This is a sustainable payout ratio.
NOC's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP31.43%
EPS Next 2Y5.77%
EPS Next 3Y6.79%
577.01
-33.6 (-5.5%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryAerospace & Defense
Earnings (Last)
Earnings (Next)
Inst Owners83.48%
Inst Owner Change0%
Ins Owners0.21%
Ins Owner Change-0.05%
Market Cap82.35B
Revenue(TTM)40.93B
Net Income(TTM)4.02B
Analysts74.81
Price Target676.91 (17.31%)
Short Float %1.08%
Short Ratio2.1
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.62% |
Yearly Dividend8.04
Dividend Growth(5Y)9.14%
DP31.43%
Div Incr Years21
Div Non Decr Years34
Ex-DateN/A
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)1.05%
PT rev (3m)9.78%
EPS NQ rev (1m)-0.01%
EPS NQ rev (3m)-7.7%
EPS NY rev (1m)-0.06%
EPS NY rev (3m)2.53%
Revenue NQ rev (1m)-0.05%
Revenue NQ rev (3m)-0.31%
Revenue NY rev (1m)-0.01%
Revenue NY rev (3m)-0.69%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 21.19 | ||
| Fwd PE | 19.78 | ||
| P/S | 2.01 | ||
| P/FCF | 44.9 | ||
| P/OCF | 23.95 | ||
| P/B | 5.15 | ||
| P/tB | N/A | ||
| EV/EBITDA | 18.09 |
EPS(TTM)27.23
EY4.72%
EPS(NY)29.17
Fwd EY5.05%
FCF(TTM)12.85
FCFY2.23%
OCF(TTM)24.09
OCFY4.17%
SpS286.77
BVpS112.02
TBVpS-11.69
PEG (NY)23.28
PEG (5Y)5.04
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 | 3.16 |
F-Score6
WACC10.03%
ROIC/WACC0.95
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 Y0.91%
EPS Next 2Y5.77%
EPS Next 3Y6.79%
EPS Next 5Y7.69%
Revenue 1Y (TTM)-0.14%
Revenue growth 3Y4.78%
Revenue growth 5Y3.93%
Sales Q2Q%4.27%
Revenue Next Year1.33%
Revenue Next 2Y3.47%
Revenue Next 3Y4.1%
Revenue Next 5Y4.28%
EBIT growth 1Y41.9%
EBIT growth 3Y5.98%
EBIT growth 5Y1.94%
EBIT Next Year33.48%
EBIT Next 3Y15.42%
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.
What is the valuation status of NORTHROP GRUMMAN CORP (NOC) stock?
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.
Can you provide the PE and PB ratios for NOC stock?
The Price/Earnings (PE) ratio for NORTHROP GRUMMAN CORP (NOC) is 21.19 and the Price/Book (PB) ratio is 5.15.
What is the financial health of NORTHROP GRUMMAN CORP (NOC) stock?
The financial health rating of NORTHROP GRUMMAN CORP (NOC) is 3 / 10.