Northrop Grumman (NYSE:NOC) Stock Falls 2.6% - What's Next?

Key Points

• Northrop Grumman shares fell 2.6% to about $550.54, while trading volume was slightly below average. The stock remains below its 200-day moving average but above its 50-day average.
• Analyst sentiment remains positive overall, with a consensus rating of “Moderate Buy” and an average price target of $643.74. Recent targets range from $540 to $680.
• The company exceeded quarterly EPS expectations, reporting $7.89 versus the $7.18 consensus, while revenue rose 6.7% year over year to $11.12 billion. Northrop Grumman also maintains a $2.47 quarterly dividend, equal to a 1.8% yield.

Shares of Northrop Grumman Corporation (NYSE:NOC - Get Free Report) fell 2.6% during trading on Tuesday. The company traded as low as $550.36 and last traded at $550.5380. Approximately 900,300 shares were traded during mid-day trading, a decline of 3% from the average daily volume of 927,695 shares. The stock had previously closed at $565.41.

Analyst Upgrades and Downgrades

NOC has been the topic of a number of recent analyst reports. BNP Paribas Exane lifted their price objective on shares of Northrop Grumman from $540.00 to $600.00 and gave the company an "outperform" rating in a research note on Wednesday, October 21st. Weiss Ratings raised Northrop Grumman from a "hold (c)" rating to a "hold (c+)" rating in a research note on Thursday, October 8th. TD Cowen dropped their target price on shares of Northrop Grumman from $590.00 to $540.00 and set a "hold" rating for the company in a report on Friday, October 9th. Citigroup upped their price objective on shares of Northrop Grumman from $617.00 to $667.00 and gave the stock a "buy" rating in a research report on Thursday, August 13th. Finally, Rothschild & Co Redburn started coverage on shares of Northrop Grumman in a research note on Tuesday, October 6th. They issued a "buy" rating and a $680.00 price objective for the company. Fifteen research analysts have rated the stock with a Buy rating, nine have assigned a Hold rating and one has issued a Sell rating to the company. According to MarketBeat, the stock currently has a consensus rating of "Moderate Buy" and an average price target of $643.74.

Northrop Grumman Stock Down 2.6%

The firm has a 50-day simple moving average of $522.58 and a 200 day simple moving average of $592.96. The stock has a market capitalization of $78.21 billion, a P/E ratio of 17.37, a P/E/G ratio of 3.02 and a beta of -0.11. The company has a debt-to-equity ratio of 0.77, a current ratio of 1.23 and a quick ratio of 1.14.

Northrop Grumman (NYSE:NOC - Get Free Report) last released its quarterly earnings data on Tuesday, October 20th. The aerospace company reported $7.89 earnings per share (EPS) for the quarter, beating the consensus estimate of $7.18 by $0.71. The company had revenue of $11.12 billion during the quarter, compared to the consensus estimate of $11.14 billion. Northrop Grumman had a return on equity of 23.46% and a net margin of 10.37%. The firm's revenue was up 6.7% compared to the same quarter last year. During the same quarter in the prior year, the firm posted $7.67 earnings per share. On average, equities research analysts forecast that Northrop Grumman Corporation will post 29.53 EPS for the current year.

Northrop Grumman Announces Dividend

The firm also recently declared a quarterly dividend, which was paid on Wednesday, September 16th. Stockholders of record on Monday, August 31st were paid a dividend of $2.47 per share. The ex-dividend date of this dividend was Monday, August 31st. This represents a $9.88 annualized dividend and a dividend yield of 1.8%. Northrop Grumman's dividend payout ratio (DPR) is presently 31.17%.

Insider Activity at Northrop Grumman

In other news, Director Mark Welsh, III sold 95 shares of Northrop Grumman stock in a transaction on Monday, August 3rd. The shares were sold at an average price of $547.53, for a total transaction of $52,015.35. Following the transaction, the director owned 4,393 shares in the company, valued at approximately $2,405,299.29. The trade was a 2.12% decrease in their ownership of the stock. The sale was disclosed in a document filed with the Securities & Exchange Commission, which is accessible through the SEC website. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Company insiders own 0.21% of the company's stock.

Institutional Inflows and Outflows

Several hedge funds and other institutional investors have recently bought and sold shares of NOC. State Street Corp raised its position in shares of Northrop Grumman by 1.3% during the second quarter. State Street Corp now owns 13,169,195 shares of the aerospace company's stock worth $6,707,203,000 after acquiring an additional 168,267 shares during the last quarter. BlackRock Inc. bought a new position in Northrop Grumman during the 2nd quarter worth approximately $6,001,616,000. Bank of America Corp DE bought a new position in Northrop Grumman during the 2nd quarter worth approximately $1,298,141,000. Dimensional Fund Advisors LP lifted its position in shares of Northrop Grumman by 0.6% in the 1st quarter. Dimensional Fund Advisors LP now owns 960,690 shares of the aerospace company's stock worth $655,373,000 after purchasing an additional 5,811 shares during the period. Finally, Bessemer Group Inc. lifted its position in shares of Northrop Grumman by 11.1% in the 1st quarter. Bessemer Group Inc. now owns 587,121 shares of the aerospace company's stock worth $400,557,000 after purchasing an additional 58,690 shares during the period. 83.40% of the stock is owned by institutional investors and hedge funds.

About Northrop Grumman

Northrop Grumman Corporation NYSE: NOC is a global aerospace and defense company that develops and produces systems for government and commercial customers, with the U.S. government representing its primary customer base. The company operates across aerospace, defense, space, cybersecurity and advanced technology markets.

Its products and services include military aircraft and autonomous systems, space systems and satellites, missile defense technologies, command-and-control systems, cyber solutions, sensors, communications networks and other mission-critical systems.

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