Northrop Grumman (NOC) and Its Competitors Head to Head Comparison

Northrop Grumman (NYSE:NOC) is one of 229 publicly-traded companies in the “Aerospace & Defense” industry, but how does it weigh in compared to its rivals? We will compare Northrop Grumman to similar companies based on the strength of its risk, profitability, institutional ownership, earnings, valuation, analyst recommendations and dividends.

Risk and Volatility

Northrop Grumman has a beta of -0.13, meaning that its stock price is 113% less volatile than the S&P 500. Comparatively, Northrop Grumman’s rivals have a beta of 1.31, meaning that their average stock price is 31% more volatile than the S&P 500.

Profitability

This table compares Northrop Grumman and its rivals’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Northrop Grumman	10.37%	23.46%	8.06%
Northrop Grumman Competitors	-278.66%	-46.60%	-4.00%

Dividends

Northrop Grumman pays an annual dividend of $9.88 per share and has a dividend yield of 1.9%. Northrop Grumman pays out 31.2% of its earnings in the form of a dividend. As a group, “Aerospace & Defense” companies pay a dividend yield of 1.1% and pay out 38.7% of their earnings in the form of a dividend. Northrop Grumman has increased its dividend for 22 consecutive years. Northrop Grumman is clearly a better dividend stock than its rivals, given its higher yield and lower payout ratio.

Analyst Ratings

This is a breakdown of recent recommendations and price targets for Northrop Grumman and its rivals, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Northrop Grumman	1	9	15	0	2.56
Northrop Grumman Competitors	2156	8258	12757	580	2.50

Northrop Grumman currently has a consensus price target of $643.74, suggesting a potential upside of 22.45%. As a group, “Aerospace & Defense” companies have a potential upside of 32.28%. Given Northrop Grumman’s rivals higher probable upside, analysts plainly believe Northrop Grumman has less favorable growth aspects than its rivals.

Valuation & Earnings

This table compares Northrop Grumman and its rivals top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
Northrop Grumman	$41.95 billion	$4.18 billion	16.58
Northrop Grumman Competitors	$8.43 billion	$569.01 million	24.68

Northrop Grumman has higher revenue and earnings than its rivals. Northrop Grumman is trading at a lower price-to-earnings ratio than its rivals, indicating that it is currently more affordable than other companies in its industry.

Insider & Institutional Ownership

83.4% of Northrop Grumman shares are owned by institutional investors. Comparatively, 49.5% of shares of all “Aerospace & Defense” companies are owned by institutional investors. 0.2% of Northrop Grumman shares are owned by company insiders. Comparatively, 11.8% of shares of all “Aerospace & Defense” companies are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Summary

Northrop Grumman beats its rivals on 10 of the 15 factors compared.

About Northrop Grumman

Northrop Grumman Corporation operates as an aerospace and defense technology company in the United States, Asia/Pacific, Europe, and internationally. The company’s Aeronautics Systems segment designs, develops, manufactures, integrates, and sustains aircraft systems. This segment also offers unmanned autonomous aircraft systems, including high-altitude long-endurance strategic ISR systems and vertical take-off and landing tactical ISR systems; and strategic long-range strike aircraft, tactical fighter and air dominance aircraft, and airborne battle management and command and control systems. Its Defense Systems segment designs, develops, integrates, and produces tactical weapons and missile defense solutions, and provides sustainment, modernization, and training services for manned and unmanned aircraft and electronics systems. It also offers integrated, all-domain command, and control battle management systems, precision strike weapons; high speed air-breathing and hypersonic systems; high-performance gun systems, ammunition, precision munitions and advanced fuzes; aircraft and mission systems logistics support, sustainment, operations and modernization; and warfighter training services. The company’s Mission Systems segment offers command, control, communications and computers, intelligence, surveillance, and reconnaissance systems; radar, electro-optical/infrared and acoustic sensors; electronic warfare systems; advanced communications and network systems; cyber solutions; intelligence processing systems; navigation; and maritime power, propulsion, and payload launch systems. Its Space Systems segment offers satellites, spacecraft systems, subsystems, sensors, and payloads; ground systems; missile defense systems and interceptors; launch vehicles and related propulsion systems; and strategic missiles. Northrop Grumman Corporation was founded in 1939 and is based in Falls Church, Virginia.