Northrop Grumman Earnings: What To Look For From NOC

Security and aerospace company Northrop Grumman (NYSE:NOC) will be reporting results this Tuesday morning. Here’s what to expect.

Northrop Grumman missed analysts’ revenue expectations by 4.7% last quarter, reporting revenues of $9.47 billion, down 6.6% year on year. It was a disappointing quarter for the company, with full-year EPS guidance missing analysts’ expectations significantly and a significant miss of analysts’ adjusted operating income estimates.

Is Northrop Grumman a buy or sell going into earnings? Read our full analysis here, it’s free.

This quarter, analysts are expecting Northrop Grumman’s revenue to decline 1.6% year on year to $10.05 billion, a reversal from the 6.7% increase it recorded in the same quarter last year. Adjusted earnings are expected to come in at $6.84 per share.

Heading into earnings, analysts covering the company have grown increasingly bearish with revenue estimates seeing 10 downward revisions over the last 30 days (we track 19 analysts). Northrop Grumman has missed Wall Street’s revenue estimates four times over the last two years.

Looking at Northrop Grumman’s peers in the aerospace and defense segment, some have already reported their Q2 results, giving us a hint as to what we can expect. AAR delivered year-on-year revenue growth of 14.9%, beating analysts’ expectations by 8.6%, and Byrna reported revenues up 40.6%, in line with consensus estimates. AAR traded up 13.4% following the results while Byrna was down 28.8%.

Read our full analysis of AAR’s results here and Byrna’s results here.

There has been positive sentiment among investors in the aerospace and defense segment, with share prices up 6.5% on average over the last month. Northrop Grumman is up 3.9% during the same time and is heading into earnings with an average analyst price target of $553.19 (compared to the current share price of $519).

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