Northrop Grumman (NYSE:NOC) Announces Earnings Results, Beats Estimates By $0.08 EPS

Key Points

• Northrop reported Q1 EPS of $6.14, beating estimates by $0.08 on $9.88 billion of revenue, and updated FY‑2026 EPS guidance to $27.40–$27.90.
• Management agreed to a 25% increase in B‑21 annual production and will invest about $2.5 billion (with ~$200 million of CapEx in 2026) to expand capacity, pushing near‑term capital intensity (2026 capex raised to ~$1.85B).
• Bookings were strong at $9.8 billion with a backlog of ~$96 billion, but Space Systems took a ~$71 million unfavorable EAC on GEM 63XL and Q1 cash burn, which weighed on investor sentiment despite the beat.

Northrop Grumman (NYSE:NOC - Get Free Report) released its earnings results on Tuesday. The aerospace company reported $6.14 earnings per share for the quarter, beating the consensus estimate of $6.06 by $0.08, FiscalAI reports. Northrop Grumman had a return on equity of 25.57% and a net margin of 9.97%.The company had revenue of $9.88 billion for the quarter, compared to the consensus estimate of $9.75 billion. During the same period in the previous year, the business earned $6.06 earnings per share. Northrop Grumman's quarterly revenue was up 4.4% compared to the same quarter last year. Northrop Grumman updated its FY 2026 guidance to 27.400-27.900 EPS.

Here are the key takeaways from Northrop Grumman's conference call:

• B-21: Northrop reached an agreement to increase the B-21 annual production rate by 25%, received Lot 3/4 LRIP awards, and will invest ~$2.5 billion (with ~$200 million of CapEx in 2026) to expand production capacity; an aircraft sale to the Air Force accelerated revenue into Q1 without changing total LRIP deliveries.
• Sentinel acceleration: The program is moving faster with a Milestone B expected later this year, first flight in 2027 and IOC in the early 2030s, delivered double-digit growth in Q1 and represents roughly 6–7% of company revenue today with further growth expected.
• Strong demand and financials: Q1 bookings were $9.8 billion with a backlog of $96 billion, sales of $9.9 billion (+5% organic), diluted EPS of $6.14, and management reaffirmed full‑year sales guidance of $43.5–44.0 billion and free cash flow guidance of $3.1–3.5 billion.
• Weapons / missile defense tailwinds: The company has invested >$2 billion to expand solid rocket motor capacity (capacity doubled, further expansion through 2027), weapons is nearing ~10% of sales, missile defense is ~10% of sales, and Northrop secured a $1.3 billion GPI award to counter hypersonics.
• Space segment headwinds: Space sales and operating income declined in Q1 due to a prior-year NGI closeout ($98 million in Q1 2025) and an unfavorable earnings adjustment of $71 million on GEM 63XL, although management said no other significant EACs were identified this quarter.

Northrop Grumman Stock Performance

NYSE:NOC opened at $611.42 on Wednesday. The company has a current ratio of 1.10, a quick ratio of 1.01 and a debt-to-equity ratio of 0.91. Northrop Grumman has a 12-month low of $450.13 and a 12-month high of $774.00. The stock has a 50-day moving average price of $705.88 and a 200 day moving average price of $639.26. The stock has a market capitalization of $86.84 billion, a P/E ratio of 20.99, a P/E/G ratio of 4.65 and a beta of 0.04.

Northrop Grumman Announces Dividend

The firm also recently disclosed a quarterly dividend, which was paid on Wednesday, March 11th. Stockholders of record on Monday, February 23rd were paid a $2.31 dividend. The ex-dividend date of this dividend was Monday, February 23rd. This represents a $9.24 dividend on an annualized basis and a dividend yield of 1.5%. Northrop Grumman's dividend payout ratio is 31.72%.

Insiders Place Their Bets

In other Northrop Grumman news, Director Mark A. Welsh III sold 95 shares of the 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 completion of the sale, the director directly owned 4,203 shares of the company's stock, valued at $2,877,037.56. This trade represents a 2.21% decrease in their position. The sale was disclosed in a filing with the SEC, which is available through the SEC website. Also, CEO Kathy J. Warden sold 20,000 shares of Northrop Grumman stock in a transaction that occurred on Friday, February 6th. The shares were sold at an average price of $708.82, for a total transaction of $14,176,400.00. Following the sale, the chief executive officer owned 171,602 shares in the company, valued at approximately $121,634,929.64. The trade was a 10.44% decrease in their position. The disclosure for this sale is available in the SEC filing. Insiders sold a total of 22,431 shares of company stock worth $15,924,404 over the last quarter. Company insiders own 0.21% of the company's stock.

Hedge Funds Weigh In On Northrop Grumman

Several institutional investors have recently bought and sold shares of NOC. Corient Private Wealth LLC raised its position in shares of Northrop Grumman by 168.8% during the 4th quarter. Corient Private Wealth LLC now owns 183,413 shares of the aerospace company's stock valued at $104,584,000 after buying an additional 115,170 shares in the last quarter. Balyasny Asset Management L.P. increased its stake in Northrop Grumman by 1,690.0% during the third quarter. Balyasny Asset Management L.P. now owns 109,138 shares of the aerospace company's stock worth $66,500,000 after acquiring an additional 103,041 shares during the last quarter. Jacobs Levy Equity Management Inc. increased its stake in Northrop Grumman by 4,951.8% during the fourth quarter. Jacobs Levy Equity Management Inc. now owns 99,166 shares of the aerospace company's stock worth $56,545,000 after acquiring an additional 97,203 shares during the last quarter. Marshall Wace LLP raised its position in Northrop Grumman by 477.1% during the fourth quarter. Marshall Wace LLP now owns 115,713 shares of the aerospace company's stock valued at $65,981,000 after purchasing an additional 95,662 shares during the period. Finally, Renaissance Technologies LLC purchased a new stake in Northrop Grumman during the fourth quarter valued at approximately $53,429,000. 83.40% of the stock is 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 $6.14 EPS on $9.88B revenue, above consensus, driven by aeronautics strength and margin gains. Q1 Earnings
• Positive Sentiment: Program tailwinds and backlog: management highlighted B‑21 progress (refueling tests, production ramp) and a roughly $96B backlog that supports long‑term revenue visibility. B-21 Progress
• Neutral Sentiment: Guidance reaffirmed: the company kept FY‑2026 sales at $43.5B–$44.0B and EPS at $27.40–$27.90, roughly in line with prior targets but slightly below Street EPS consensus — a key reason for the weak reaction. Guidance/Reaffirmation
• Neutral Sentiment: Analyst backdrop remains constructive: several firms maintain buy ratings and above‑market price targets, leaving upside potential over the medium term despite the near‑term pullback. Analyst Coverage
• Negative Sentiment: Higher near‑term capital intensity: management raised 2026 capex to ~$1.85B to expand B‑21 production capacity, increasing near‑term cash needs. Capex Increase
• Negative Sentiment: Quarterly cash burn and program charges: Q1 used operating and free cash flow (seasonal but sizable), and Space Systems recorded a ~$71M unfavorable EAC adjustment related to a GEM 63XL launch anomaly — both amplified investor concern. Cash Burn / Charge
• Negative Sentiment: Market reaction: despite the beat, investors sold into the print because management reaffirmed (rather than raised) targets and flagged higher investment and near‑term cash usage; that drove today’s share weakness. Market Reaction

Wall Street Analyst Weigh In

A number of analysts have commented on the company. Morgan Stanley restated an "overweight" rating and issued a $765.00 price target on shares of Northrop Grumman in a research report on Wednesday, January 28th. Argus set a $785.00 price objective on Northrop Grumman in a research report on Tuesday, February 10th. Citigroup boosted their price objective on Northrop Grumman from $781.00 to $807.00 and gave the company a "buy" rating in a research note on Thursday, April 2nd. Jefferies Financial Group increased their target price on shares of Northrop Grumman from $690.00 to $710.00 and gave the stock a "hold" rating in a report on Thursday, April 9th. Finally, Weiss Ratings restated a "buy (b)" rating on shares of Northrop Grumman in a research note on Monday, March 23rd. Two investment analysts have rated the stock with a Strong Buy rating, ten have issued a Buy rating and eight have assigned a Hold rating to the company. Based on data from MarketBeat, the company has a consensus rating of "Moderate Buy" and a consensus price target of $719.58.

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.