If President Trump can still make good on his election promise to build 42 more naval ships and 100 more modern fighter aircraft, as well as improving our nuclear, missile and cyber defenses, you’re going to see the entire defense sector take off. However, when I put this sector under the microscope, most of what I see either I don’t like or it’s not centered on the sectors the president wants to focus spending on. But one company stands out. This morning it released earnings. In today’s blog, we’ll see what it had to say…
Northrop Grumman Corp. (NOC) is a major defense contractor, serving the U.S. and 25 other nations, providing systems, products and solutions in aerospace, electronics, information systems and technical service areas to government and commercial customers worldwide. The company was founded in 1939 and is based in Falls Church, VA.
The company’s Aerospace Systems segment designs, develops, integrates, and produces manned aircraft, unmanned systems, spacecraft, high-energy laser systems, microelectronics and other systems and subsystems.
Its Electronic Systems segment offers solutions for sensing, understanding, anticipating and controlling the operating environment to military, civil and commercial customers.
The company’s Information Systems segment offers advanced solutions for Department of Defense, national intelligence, federal civilian, state, international and commercial customers.
And its Technical Services segment provides logistics, modernization and sustainment services, as well as other advanced technology and engineering services, including space, missile defense, nuclear security, training and simulation services.
Before the opening bell this morning, Northrop Grumman Corp. (NOC) announced its third-quarter earnings results.
Sales rose 6% year-over-year to $6.5 billion, compared with $6.2 billion in the third quarter of 2016. This topped the $6.3 billion consensus estimate by 2.7%. Over the same period, earnings increased 10% to $3.68 per share. Analysts were looking for $2.92. So, Northrop Grumman posted a nice 26% earnings surprise.
For FY 2017, Northrop Grumman expects to see sales of approximately $25.5 billion, up from their previous outlook of $25.0 billion. Also, the company has lifted its earnings guidance for FY 2017, expecting to see between $12.90 and $13.10, up from their previous target between $12.10 and $12.40. NOC shares climbed about 3% after the market opened following these better-than-expected results.
All of this bodes well for the defense giant, and once again, it’s no wonder NOC maintains an A-rating in my Portfolio Grader tool. You can discover even more about Northrop Grumman—including my exclusive Buy Below price for this company—by joining my Blue Chip Growth service today.
If you aren’t ready to join Blue Chip Growth, however, I urge you to stay tuned into this blog, where we’ll continue exploring some of the top earnings announcements of this season.