NORTHROP GRUMMAN CORP (NOC) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:NOC - US6668071029 - Common Stock
570.21 USD
-4.36 (-0.76%)
570 USD
-0.21 (-0.04%)
NOC gets a fundamental rating of 5 out of 10. The analysis compared the fundamentals against 71 industry peers in the Aerospace & Defense industry. NOC scores excellent on profitability, 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.
In the past 5 years NOC has always been profitable.
In the past 5 years NOC always reported a positive cash flow from operatings.
1.2 Ratios
NOC's Return On Assets of 8.15% is amongst the best of the industry. NOC outperforms 88.73% 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 92.96% of the companies in the same industry.
With an excellent Return On Invested Capital value of 9.57%, NOC belongs to the best of the industry, outperforming 81.69% of the companies in the same industry.
NOC had an Average Return On Invested Capital over the past 3 years of 8.81%. This is in line with the industry average of 8.60%.
The last Return On Invested Capital (9.57%) for NOC is above the 3 year average (8.81%), which is a sign of increasing profitability.
| 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
Looking at the Profit Margin, with a value of 9.82%, NOC is in the better half of the industry, outperforming 78.87% of the companies in the same industry.
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 60.56% of the companies in the same industry.
NOC's Operating Margin has declined in the last couple of years.
NOC has a worse Gross Margin (19.42%) than 66.20% 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
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), 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.
NOC has a worse debt/assets ratio than last year.
2.2 Solvency
NOC has an Altman-Z score of 3.07. This indicates that NOC is financially healthy and has little risk of bankruptcy at the moment.
The Altman-Z score of NOC (3.07) is comparable to the rest of the industry.
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.
The Debt to FCF ratio of NOC (8.56) is comparable to the rest of the industry.
A Debt/Equity ratio of 0.95 indicates that NOC is somewhat dependend on debt financing.
The Debt to Equity ratio of NOC (0.95) is worse than 77.46% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.95 | ||
| Debt/FCF | 8.56 | ||
| Altman-Z | 3.07 |
ROIC/WACC0.97
WACC9.89%
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 87.32% 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.
The Quick ratio of NOC (0.98) is worse than 74.65% 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.
The Earnings Per Share has been growing slightly by 4.20% on average over the past years.
The Revenue has decreased by -0.14% in the past 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
Based on estimates for the next years, NOC will show a small growth in Earnings Per Share. The EPS will grow by 7.69% on average per year.
NOC is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 4.28% yearly.
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.
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
The Price/Earnings ratio is 20.94, which indicates a rather expensive current valuation of NOC.
Based on the Price/Earnings ratio, NOC is valued cheaply inside the industry as 90.14% of the companies are valued more expensively.
NOC's Price/Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 26.51.
With a Price/Forward Earnings ratio of 19.55, NOC is valued on the expensive side.
NOC's Price/Forward Earnings ratio is rather cheap when compared to the industry. NOC is cheaper than 88.73% of the companies in the same industry.
The average S&P500 Price/Forward Earnings ratio is at 23.13. NOC is around the same levels.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 20.94 | ||
| Fwd PE | 19.55 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of NOC indicates a rather cheap valuation: NOC is cheaper than 83.10% of the companies listed in the same industry.
Based on the Price/Free Cash Flow ratio, NOC is valued a bit cheaper than the industry average as 67.61% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 44.37 | ||
| EV/EBITDA | 17.16 |
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)23.01
PEG (5Y)4.98
EPS Next 2Y5.77%
EPS Next 3Y6.79%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 1.59%, NOC has a reasonable but not impressive dividend return.
Compared to an average industry Dividend Yield of 0.39, NOC pays a better dividend. On top of this NOC pays more dividend than 92.96% of the companies listed in the same industry.
Compared to the average S&P500 Dividend Yield of 2.00, NOC is paying slightly less dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.59% |
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 their dividend for at least 10 years, which is a reliable track record.
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.
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%
570.21
-4.36 (-0.76%)
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-0.03%
Market Cap81.38B
Revenue(TTM)40.93B
Net Income(TTM)4.02B
Analysts74.81
Price Target676.91 (18.71%)
Short Float %1.08%
Short Ratio2.1
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.59% |
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)10.05%
EPS NQ rev (1m)-0.01%
EPS NQ rev (3m)-7.51%
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)-0.03%
Revenue NY rev (3m)-0.7%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 20.94 | ||
| Fwd PE | 19.55 | ||
| P/S | 1.99 | ||
| P/FCF | 44.37 | ||
| P/OCF | 23.67 | ||
| P/B | 5.09 | ||
| P/tB | N/A | ||
| EV/EBITDA | 17.16 |
EPS(TTM)27.23
EY4.78%
EPS(NY)29.17
Fwd EY5.11%
FCF(TTM)12.85
FCFY2.25%
OCF(TTM)24.09
OCFY4.22%
SpS286.77
BVpS112.02
TBVpS-11.69
PEG (NY)23.01
PEG (5Y)4.98
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 | 3.07 |
F-Score6
WACC9.89%
ROIC/WACC0.97
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 20.94 and the Price/Book (PB) ratio is 5.09.
What is the financial health of NORTHROP GRUMMAN CORP (NOC) stock?
The financial health rating of NORTHROP GRUMMAN CORP (NOC) is 3 / 10.