Northrop Grumman Reports Strong Q4 Earnings but Lowers FY26 Outlook
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 1d ago
0mins
Source: Benzinga
- Strong Earnings: Northrop Grumman reported Q4 earnings of $7.23 per share, surpassing the analyst consensus of $6.97, indicating robust performance in the defense sector despite market uncertainties.
- Sales Growth: The company achieved quarterly sales of $11.712 billion, exceeding the analyst estimate of $11.626 billion, reflecting successful execution on key projects and sustained market demand.
- Lowered Outlook: Northrop Grumman projects FY2026 adjusted EPS between $27.40 and $27.90, below market expectations of $28.85, indicating uncertainty in future growth that may affect investor confidence.
- Analyst Rating Changes: Following the earnings announcement, BofA Securities raised its price target from $685 to $750, while BTIG increased its target from $680 to $815, reflecting analysts' confidence in the company's long-term prospects.
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Analyst Views on NOC
Wall Street analysts forecast NOC stock price to fall over the next 12 months. According to Wall Street analysts, the average 1-year price target for NOC is 684.08 USD with a low forecast of 630.00 USD and a high forecast of 770.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
13 Analyst Rating
10 Buy
3 Hold
0 Sell
Strong Buy
Current: 689.130
Low
630.00
Averages
684.08
High
770.00
Current: 689.130
Low
630.00
Averages
684.08
High
770.00
About NOC
Northrop Grumman Corporation is a global aerospace and defense technology company. Its segments include Aeronautics Systems, Defense Systems, Mission Systems, and Space Systems. Aeronautics Systems is engaged in the design, development, production, integration, sustainment and modernization of military aircraft systems for the United States Air Force, the United States Navy, other United States government agencies, and international customers. Defense Systems is engaged in the design, engineering, development, integration, and manufacturing of deterrent systems, advanced tactical weapons, and missile defense solutions. Mission Systems is a provider of mission solutions and multifunction systems. Its products and services include command, control, communications and computers, and reconnaissance (C4ISR) systems. Space Systems delivers end-to-end mission solutions through the design, development, integration, production and operation of space, missile defense, and launch systems.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Northrop Grumman Reports Strong Quarterly Earnings with $95.7 Billion Backlog
- Earnings Beat Expectations: Northrop Grumman reported fourth-quarter revenue of $11.71 billion and earnings per share of $7.23, both exceeding analyst expectations, demonstrating strong performance aligned with defense spending trends.
- Significant Sales Growth: The company experienced a 10% year-over-year increase in sales during the fourth quarter, primarily driven by ramp-ups in the F-35 program and new awards, further solidifying its market position in Aeronautics and Mission Systems.
- Strong Financial Outlook: Northrop Grumman projects revenue between $43.5 billion and $44 billion for 2026, with free cash flow expected between $3.1 billion and $3.5 billion, reflecting confidence in sustained growth and profitability.
- Regulatory Changes Favorable: The enactment of the One Big Beautiful Bill Act provides Northrop Grumman with financial flexibility by repealing mandatory capitalization of R&D expenditures, enhancing its ability to invest in growth areas.
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- Indirect Investment Channels: Investors can gain indirect exposure through publicly traded companies like Lockheed Martin (LMT) and Northrop Grumman (NOC), which earn revenue from government contracts and commercial services, showcasing a diversified business model.
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