Northrop Grumman (NOC – Research Report), the Industrials sector company, was revisited by a Wall Street analyst yesterday. Analyst Matthew Akers from Wells Fargo maintained a Hold rating on the stock and has a $483.00 price target.
Matthew Akers has given his Hold rating due to a combination of factors observed in Northrop Grumman’s recent performance and future guidance. The company’s Aerospace Systems (AS) segment demonstrated significant top-line growth, contributing to better-than-expected quarterly earnings per share (EPS). This outperformance suggests that the company’s full year guidance may be on the conservative side. However, the stock is currently facing cautious market sentiment, which might limit its short-term upside potential. Despite the Q1 earnings beat, the company’s margin came in slightly lower than anticipated, and the free cash flow (FCF) usage was higher than Akers’ model predicted.
The updated fiscal year 2024 guidance provided by Northrop Grumman includes unchanged EPS projections, which align closely with consensus estimates. Sales guidance is moderately below what was anticipated, while segment profit expectations are in line with Akers’ forecast. There are adjustments within the segment sales and margin guidance, with Aerospace Systems expected to perform better and Space Systems projected lower than previously estimated. Defense Systems (DS) margins are forecasted to be slightly higher, whereas Mission Systems (MS) margins are anticipated to be lower. These mixed signals contribute to Akers’ decision to maintain a Hold rating, indicating a balanced view of potential growth against prevailing uncertainties in market conditions and company performance.
In another report released on April 15, Barclays also maintained a Hold rating on the stock with a $470.00 price target.
NOC’s price has also changed slightly for the past six months – from $483.260 to $488.060, which is a 0.99% increase.
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Northrop Grumman (NOC) Company Description:
Virginia-based Northrop Grumman Corp. is a global aerospace and defense technology company. It operates through the following business segments: Aeronautics Systems, Defense Systems, Mission Systems, and Space Systems.
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