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Northrop Grumman (NOC) Dips More Than Broader Markets: What You Should Know

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Northrop Grumman (NOC) closed at $465.20 in the latest trading session, marking a -0.78% move from the prior day. This move lagged the S&P 500's daily loss of 0.45%. Elsewhere, the Dow lost 0.67%, while the tech-heavy Nasdaq lost 0.06%.

Heading into today, shares of the defense contractor had gained 3.17% over the past month, outpacing the Aerospace sector's gain of 0.09% and the S&P 500's loss of 1.89% in that time.

Wall Street will be looking for positivity from Northrop Grumman as it approaches its next earnings report date. This is expected to be July 28, 2022. The company is expected to report EPS of $6.03, down 6.07% from the prior-year quarter. Our most recent consensus estimate is calling for quarterly revenue of $9.12 billion, down 0.37% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $24.80 per share and revenue of $36.59 billion, which would represent changes of -3.24% and +2.6%, respectively, from the prior year.

Investors might also notice recent changes to analyst estimates for Northrop Grumman. These revisions help to show the ever-changing nature of near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Within the past 30 days, our consensus EPS projection remained stagnant. Northrop Grumman is currently a Zacks Rank #3 (Hold).

Valuation is also important, so investors should note that Northrop Grumman has a Forward P/E ratio of 18.91 right now. This valuation marks a premium compared to its industry's average Forward P/E of 17.07.

It is also worth noting that NOC currently has a PEG ratio of 3.1. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. The Aerospace - Defense was holding an average PEG ratio of 2.03 at yesterday's closing price.

The Aerospace - Defense industry is part of the Aerospace sector. This industry currently has a Zacks Industry Rank of 148, which puts it in the bottom 42% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

To follow NOC in the coming trading sessions, be sure to utilize Zacks.com.


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