Northrop Grumman Partners With NCSIST for Missile Defense Upgrade

Northrop Grumman Corporation NOC and the National Chung-Shan Institute of Science and Technology (NCSIST) have signed a memorandum of understanding to explore collaboration on air and missile defense modernization for the Taiwan Ministry of National Defense.

NCSIST is Taiwan’s leading defense research and development institution and focuses on developing, manufacturing and selling defense technologies to strengthen Taiwan’s self-reliant defense capabilities.

Northrop Grumman will use its experience from the Integrated Battle Command System, the U.S. Army’s main air and missile defense program. The company will combine this expertise with NCSIST’s defense technology capabilities. The collaboration aims to strengthen Taiwan's readiness against evolving threats.

What’s Favoring NOC Stock?

According to a report from the Mordor Intelligence firm, rising military conflicts, terrorism and border disputes have led nations to increase their focus on national security, particularly on missile defense systems in recent times, backed by the rapid development of advanced missile technologies over the last decade. Mordor Intelligence also forecasts that the global missiles and missile defense systems market will witness a compound annual growth rate of 4.97% during the 2025-2030 period.

Such strong growth projections indicate solid opportunities for Northrop Grumman, which develops and builds advanced missile defense technology, ranging from command systems to directed energy weapons, advanced munitions and powerful sensors. Notably, NOC’s IBCS serves as the centerpiece of the U.S. Army's air and missile defense modernization strategy and thus enjoys a solid demand in the missile and missile defense systems market. The recent contract is an example of that.

Opportunities for Other Defense Stocks

Other defense companies that are likely to enjoy the perks of the expanding missiles and missile system market have been discussed below.

RTX Corporation RTX: It is known for its missile defense systems like the Patriot and SM-6, which are in high demand globally. RTX also provides advanced sensors and interceptors to identify, track and defeat threats as part of a layered missile defense.

The company’s long-term (three to five years) earnings growth rate is 9.1%. The Zacks Consensus Estimate for RTX’s 2025 sales indicates year-over-year growth of 6.1%.

The Boeing Company BA: It manufactures various missile defense systems, including the Ground-based Midcourse Defense, Aegis Ballistic Missile Defense and Avenger. Boeing-built air and missile defense systems have been protecting its customers for nearly 25 years against threats ranging from intercontinental ballistic missiles to hostile aircraft.

The company has a long-term earnings growth rate of 17.9%. The Zacks Consensus Estimate for BA’s 2025 sales indicates year-over-year growth of 28.8%.

Lockheed Martin Corporation LMT: Lockheed Martin’s renowned missile program includes the Patriot Advanced Capability-3 and Terminal High-Altitude Area Defense air and missile defense programs. It also manufactures the Multiple Launch Rocket System, the Joint Air-to-Surface Standoff Missile and Javelin tactical missile programs alongside other tactical missiles.

The company has a long-term earnings growth rate of 10.3%. The Zacks Consensus Estimate for LMT’s 2025 sales indicates year-over-year growth of 4.5%.

NOC Stock’s Price Movement

Shares of NOC have gained 18.5% in the past three months compared with the industry’s 11.1% growth.

NOC’s Zacks Rank

NOC currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

This article originally published on Zacks Investment Research (zacks.com).

Zacks Investment Research