Morgan Stanley Has Lowered Expectations for Northrop Grumman (NYSE:NOC) Stock Price

Key Points

• Morgan Stanley cut its price target on Northrop Grumman to $745 from $765 but kept an "overweight" rating, implying roughly a 25.75% upside from the prior close.
• Northrop beat Q1 estimates with $6.14 EPS and $9.88B revenue and reaffirmed FY‑2026 guidance of $27.40–$27.90 EPS, but the stock fell about 3.1% to $592.43 amid larger-than-expected cash burn, a ~$71M Space Systems charge, and recent insider selling.
• Analyst sentiment is broadly positive but varied: MarketBeat shows a consensus rating of "Moderate Buy" with an average target of $718.53, while individual price targets range roughly from $688 to $815 and institutional ownership is high (~83%).

Northrop Grumman (NYSE:NOC - Get Free Report) had its price target lowered by investment analysts at Morgan Stanley from $765.00 to $745.00 in a report released on Wednesday,Benzinga reports. The brokerage currently has an "overweight" rating on the aerospace company's stock. Morgan Stanley's price target points to a potential upside of 25.75% from the company's previous close.

A number of other research firms have also recently weighed in on NOC. Argus set a $785.00 target price on shares of Northrop Grumman in a research note on Tuesday, February 10th. Vertical Research reiterated a "hold" rating and issued a $688.00 target price on shares of Northrop Grumman in a research note on Tuesday, January 27th. Sanford C. Bernstein reiterated a "market perform" rating and issued a $727.00 target price on shares of Northrop Grumman in a research note on Monday, January 12th. TD Cowen reiterated a "hold" rating on shares of Northrop Grumman in a research note on Wednesday, January 28th. Finally, Susquehanna reiterated a "positive" rating and issued a $752.00 target price on shares of Northrop Grumman in a research note on Thursday, January 15th. Two investment analysts have rated the stock with a Strong Buy rating, ten have assigned a Buy rating and eight have given a Hold rating to the company. According to MarketBeat.com, the company presently has an average rating of "Moderate Buy" and a consensus price target of $718.53.

Northrop Grumman Stock Down 3.1%

NOC stock traded down $18.70 during trading on Wednesday, reaching $592.43. The stock had a trading volume of 470,556 shares, compared to its average volume of 933,273. Northrop Grumman has a one year low of $453.01 and a one year high of $774.00. The company has a quick ratio of 1.01, a current ratio of 1.10 and a debt-to-equity ratio of 0.91. The company's 50 day moving average is $705.88 and its two-hundred day moving average is $639.26. The company has a market capitalization of $84.15 billion, a price-to-earnings ratio of 20.35, a P/E/G ratio of 4.65 and a beta of 0.04.

Northrop Grumman (NYSE:NOC - Get Free Report) last issued its quarterly earnings data on Tuesday, April 21st. The aerospace company reported $6.14 earnings per share (EPS) for the quarter, topping analysts' consensus estimates of $6.06 by $0.08. Northrop Grumman had a net margin of 9.97% and a return on equity of 25.57%. The business had revenue of $9.88 billion during the quarter, compared to the consensus estimate of $9.75 billion. During the same period in the prior year, the firm posted $6.06 EPS. The firm's quarterly revenue was up 4.4% compared to the same quarter last year. Northrop Grumman has set its FY 2026 guidance at 27.400-27.900 EPS. Equities research analysts forecast that Northrop Grumman will post 28.11 EPS for the current year.

Insider Buying and Selling at Northrop Grumman

In related news, Director Mark A. Welsh III sold 95 shares of the company's stock in a transaction that occurred on Monday, February 2nd. The shares were sold at an average price of $684.52, for a total transaction of $65,029.40. Following the sale, the director directly owned 4,203 shares in the company, valued at approximately $2,877,037.56. This represents a 2.21% decrease in their position. The sale was disclosed in a filing with the SEC, which can be accessed through this hyperlink. Also, VP Benjamin R. Davies sold 2,189 shares of the company's stock in a transaction that occurred on Wednesday, February 18th. The shares were sold at an average price of $719.61, for a total transaction of $1,575,226.29. Following the sale, the vice president owned 151 shares in the company, valued at $108,661.11. The trade was a 93.55% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. Over the last 90 days, insiders have sold 22,431 shares of company stock valued at $15,924,404. 0.21% of the stock is owned by corporate insiders.

Institutional Trading of Northrop Grumman

A number of institutional investors have recently modified their holdings of NOC. Capital World Investors lifted its stake in shares of Northrop Grumman by 39.4% during the 4th quarter. Capital World Investors now owns 3,434,041 shares of the aerospace company's stock valued at $1,958,151,000 after buying an additional 970,029 shares in the last quarter. J. Stern & Co. LLP lifted its stake in shares of Northrop Grumman by 56,920.9% during the 4th quarter. J. Stern & Co. LLP now owns 421,955 shares of the aerospace company's stock valued at $240,603,000 after buying an additional 421,215 shares in the last quarter. Jennison Associates LLC lifted its stake in shares of Northrop Grumman by 272.8% during the 4th quarter. Jennison Associates LLC now owns 401,664 shares of the aerospace company's stock valued at $229,033,000 after buying an additional 293,909 shares in the last quarter. Holocene Advisors LP purchased a new stake in shares of Northrop Grumman during the 3rd quarter valued at approximately $137,280,000. Finally, Bank of New York Mellon Corp lifted its stake in shares of Northrop Grumman by 26.7% during the 3rd quarter. Bank of New York Mellon Corp now owns 1,051,226 shares of the aerospace company's stock valued at $640,534,000 after buying an additional 221,431 shares in the last quarter. 83.40% of the stock is currently owned by hedge funds and other institutional investors.

Key Headlines Impacting Northrop Grumman

Here are the key news stories impacting Northrop Grumman this week:

• Positive Sentiment: Q1 beat — Northrop reported $9.88B in revenue (+4.4% y/y) and $6.14 adjusted EPS, modestly above consensus, showing continued strength in aeronautics and missile programs. Read More.
• Positive Sentiment: Strong backlog & defense tailwinds — Management highlighted elevated defense demand (including B‑21 and missile systems) and a large backlog that supports multi‑year visibility. Read More.
• Positive Sentiment: Analyst support — BTIG reaffirmed a Buy and a $815 price target (well above current levels), and multiple firms maintain above‑consensus targets, providing upside from longer‑term investors. Read More.
• Neutral Sentiment: FY‑2026 guidance reaffirmed — Northrop reiterated EPS guidance of $27.40–$27.90 and ~$43.5–$44.0B revenue (slightly below some analyst medians). That keeps FY visibility intact but removes an upside catalyst that some traders wanted. Read More.
• Neutral Sentiment: Capex raised for B‑21 ramp — Management lifted 2026 capex to ~$1.85B to expand B‑21 production capacity, which supports future revenue but increases near‑term investment intensity. Read More.
• Negative Sentiment: Quarterly cash burn / weaker FCF — The quarter showed operating cash flow and free cash flow uses (seasonal but larger than some expected), raising short‑term funding and valuation concerns. Read More.
• Negative Sentiment: Program adjustment in Space Systems — A ~$71M unfavorable EAC adjustment tied to a GEM 63XL launch anomaly and margin pressure in Space Systems weighed on results and near‑term operating income. Read More.
• Negative Sentiment: Market reaction: reaffirm vs. raise and insider selling — Traders punished the stock because guidance was reaffirmed (not raised) and headlines highlighted insider sales, prompting a pullback despite the beat. Read More.

About Northrop Grumman

Northrop Grumman Corporation NYSE: NOC is a leading U.S.-based aerospace and defense company that designs, builds and sustains advanced systems, products and technologies for government and commercial customers. Formed through the combination of Northrop and Grumman businesses in the 1990s, the company's portfolio spans manned and unmanned aircraft, space systems, missile defense, radar and sensor systems, and integrated command, control, communications, computers, intelligence, surveillance and reconnaissance (C4ISR) solutions.

The company's work includes airframe and platform manufacturing, space hardware and satellite systems, advanced mission systems and cybersecurity services, as well as logistics, sustainment and modernization programs.

This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to contact@marketbeat.com.