Key Takeaways for Northrop Grumman Stock as of July 2026
- $10,876 million in second-quarter revenue beat estimates by 0.66% and adjusted EPS of $7.68 cleared consensus by 12.66%, even as EBITDA fell 17.58% year over year to $1,463 million.
- Following the print, Northrop Grumman raised full-year EPS guidance by $1.20 to a range of $28.60 to $29.10 and lifted sales guidance to $44 billion at the midpoint, a jump of over 5% organic growth.
- But margin pressure from two programs cut into the quarter: CEO Kathy Warden acknowledged unfavorable cost adjustments on GEM 63XL and Stand-In Attack Weapon, saying management remains confident in the team’s ability to complete qualification and deliver.
Two Program Missteps Couldn’t Derail Northrop Grumman’s Q2 Beat
Northrop Grumman stock (NOC) closed at $512.29 on July 21, 2026, the day the company posted second-quarter revenue of $10,876 million, a 0.66% beat against Street estimates of $10,804.59 million and a 10.07% jump from the prior quarter. Adjusted EPS of $7.68 topped the $6.82 estimate by 12.66%, helped by a lower effective tax rate tied to a remeasurement of uncertain tax positions. Sales grew across all four segments, up 5% year over year, and management pointed to that breadth as the reason it raised full-year guidance rather than trimming it.
The guide now calls for sales of $43.75 billion to $44.25 billion, more than 5% organic growth, and adjusted EPS of $28.60 to $29.10, an increase of $1.20 from the prior outlook. Book-to-bill for the full year is expected to reach at least 1.25x, up from earlier expectations, after the quarter alone produced $20 billion in net awards and a 1.84x book-to-bill ratio. That demand pushed backlog to a record $105 billion, up 17% year over year, with $7.6 billion of that increase coming from further definitization on the Sentinel intercontinental ballistic missile program.
Underneath the headline beat, two programs dragged segment margins lower. Space posted an 8.6% operating margin after an unfavorable cost adjustment on the GEM 63XL solid rocket motor program tied to a first-quarter launch anomaly; strip that out and the rest of the segment ran above 11%. Defense Systems margin came in at 7.5% after a $68 million charge on Stand-In Attack Weapon, a tactical missile still in qualification testing. CEO Kathy Warden addressed the overrun directly on the Q2 earnings call: “As we mature production on the AARGM-ER program, which is the basis of the technology for Stand-In Attack Weapon, we have had some delays in testing that have resulted in a flow-through to the schedule for design and qualification.” She added that the company has added engineering resources and lab capacity to work through both issues.
Free cash flow told a similar story of underlying strength masked by timing. FCF of $978 million rose 53.53% year over year but missed the Street’s $1,462.09 million estimate by 33.11%, while capital expenditures of $302 million came in 31.13% below forecast as spending on new production facilities continues to ramp. Aeronautics, meanwhile, posted the cleanest quarter of the four segments, with sales up 13% and margin at 10.3% on B-21 bomber production strength, evidence that the Space and Defense Systems charges were isolated rather than systemic.
TIKR Values Northrop Grumman Stock at $739 Despite the Quarter’s Margin Noise
TIKR’s mid-case model values Northrop Grumman at $739 by late 2030, implying a 44% total return from the current price of $512, or 9% annualized over roughly 4.4 years.
That annualized return sits below what a defense investor might expect from a company sitting on a record $105 billion backlog and a 1.84x quarterly book-to-bill, reflecting a stock that already trades near its target rather than at a deep discount to it.
The case for reaching that target rests on the same dynamic visible in the quarter’s segment results: Aeronautics already running above 10% margin while Defense Systems and Space work through isolated cost overruns on GEM 63XL and Stand-In Attack Weapon that management expects to resolve through qualification. Once those two programs clear testing, the raised full-year guide of $28.60 to $29.10 in EPS becomes the new baseline rather than the ceiling.
Should You Invest in Northrop Grumman Corporation?
The only way to really know is to look at the numbers yourself. TIKR gives you free access to the same institutional-quality financial data that professional analysts use to answer exactly that question.
Pull up Northrop Grumman Corporation stock and you’ll see years of historical financials, what Wall Street analysts expect for revenue and earnings in the quarters ahead, how valuation multiples have moved over time, and whether price targets are trending up or down.
You can build a free watchlist to track Northrop Grumman Corporation alongside every other stock on your radar. No credit card required. Just the data you need to decide for yourself.
Access Professional Tools to Analyze NOC stock on TIKR for Free →
Looking for New Opportunities?
- See what stocks billionaire investors are buying so you can follow the smart money.
- Analyze stocks in as little as 5 minutes with TIKR’s all-in-one, easy-to-use platform.
- The more rocks you overturn… the more opportunities you’ll uncover. Search 100K+ global stocks, global top investor holdings, and more with TIKR.
Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any stocks mentioned. Thank you for reading, and happy investing!
