Northrop Grumman CorporationNYSE
Thu, Dec. 8, 5:57 PM
- Shares of defense giants Lockheed Martin (NYSE:LMT), Northrop Grumann (NYSE:NOC), Raytheon (NYSE:RTN) and General Dynamics (NYSE:GD) slipped in today's trade, giving back a bit of the group's strong gains enjoyed since election day: LMT -2.7%, NOC -3.8%, RTN -1.8%, GD -2.6%.
- Cowen analysts warn that while Pres.-elect Trump's Air Force One criticism likely will not hurt Boeing, his habit of using Twitter as a bully pulpit could pose a bigger risk for LMT and NOC, which have big-ticket defense contracts.
- "This is in line with his campaign comment that he wants to boost defense spending but feels DoD could 'buy smarter,'" Cowen says. "Presumably he won't comment on all defense contracts but will focus on high profile programs. However, given his power as president, this can have an impact on specific programs."
- LMT's F-35 program has long been criticized for its $400B development and acquisition price tag, and NOC's B-21 bomber recently has been hit for not disclosing a fuller estimate on its cost, which analysts estimate at $50B-$80B.
Thu, Dec. 8, 10:46 AM
- Northrop Grumman (NOC -2.4%) has elected General Mark Welsh to its board.
- Welsh, who was the Air Force's chief of staff last year when it gave Northrop a coveted contract for a new long-range strike bomber, is currently Dean of the Bush School of Government and Public Service at Texas A&M University.
- With the addition of Welsh, Northrop's board increases to 14 members, 13 of whom are independent directors.
Fri, Dec. 2, 3:54 AM
- President Obama is poised to block a Chinese company from buying Germany's Aixtron (NASDAQ:AIXG) because Northrop Grumman (NYSE:NOC), a major U.S. defense contractor, is among the chip equipment maker's customers.
- It would mark only the third time in more than a quarter century that the White House rejected an investment by an overseas buyer as a national security risk.
- Aixtron shares -6.5% in Frankfurt.
Thu, Dec. 1, 4:00 AM
- The EU plans to boost its defense budget to its highest level in over a decade, setting up a €5B fund and sending a signal to Donald Trump that it intends to pay for its own security.
- "This is not about an EU army, this is not about spending on the military instead of social security," European Commission Vice President Jyrki Katainen said. "We face multiplying threats and we must act."
- Related tickers: LMT, RTN, GD, NOC, OA, HII, HON, UTX, ITT, TXT, LLL, COL
Wed, Nov. 30, 2:47 PM
- Northrop Grumman’s (NOC -0.6%) program to develop an upgraded, cyber-hardened network for major air operations has nearly doubled in cost and a key deadline has slipped by more than three years, the U.S. Air Force says.
- The network's development phase is now estimated to cost $745M, up from $374M originally, according to a report submitted to Congress last week and seen by Bloomberg; including procurement and support, the system has a projected $2.98B price tag.
- The air operations network “is essential to national security,” the report says, and must be modernized “to address today’s evolving cyber environment,” command-and-control mission changes “and accelerating technological advancements."
Wed, Nov. 16, 6:03 PM
Thu, Nov. 10, 6:36 PM
- Northrop Grumman (NYSE:NOC) and L-3 Communications (NYSE:LLL) are upgraded to Overweight from Equal Weight, and Lockheed Martin (NYSE:LMT) is upgraded to Equal Weight from Underweight at Barclays, as the Trump victory arguably gives new life to a bullish trade that's now less based on safe-haven status and more on absolute vs. relative growth.
- Details on budget and national security changes under Trump are scarce, but Barclays believes the market will assign a 100% probability to the prospect of higher defense budgets in the near future; for defense stocks, the near term is not about fundamentals or estimate revisions per se - which the firm thinks will not change much - but instead about the simplistic view that defense spending under Trump will be higher.
- Also, the firm shifts its neutral posture on defense to positive, on the belief that shares stay well bid in short-to-medium term.
Wed, Nov. 9, 5:34 AM
- Donald Trump has called for eliminating the sequester on defense spending and initiating a military buildup, boosting troop levels and the number of ships and aircraft.
- He seeks to fully offset the cost through "common sense reforms that eliminate government waste and budget gimmicks" and additional payments from countries where the U.S. has military bases, including Germany, Saudi Arabia and Japan.
- Premarket movement: LMT +4.5%, RTN +1.7%, GD, BA, NOC, OA, HII, HON, UTX, OTCPK:EADSF, ITT, TXT, LLL, OTCPK:BAESY, OTCPK:FINMY, COL
Wed, Nov. 2, 6:20 PM
- Lockheed Martin (NYSE:LMT) has concluded negotiations with the U.S. Defense Department on a contract for 57 F-35 fighter jets after 14 months of negotiations on the $6.1B-plus deal.
- Reuters reports the contract will provide profit margin certainty to LMT and its partners - including Northrop Grumman (NYSE:NOC), Pratt & Whitney (NYSE:UTX) and BAE Systems (OTCPK:BAESF, OTCPK:BAESY) - who have been producing the jet under a placeholder agreement.
- However, LMT says the contract was "not a mutually agreed upon contract, it was a unilateral contract action, which obligates us to perform under standard terms and conditions, and previously agreed-to items."
- Another production contract, a 94-plane deal, is said to remain under negotiation.
Fri, Oct. 28, 7:34 AM
- The Pentagon has canceled 22 programs in advanced development after spending a combined $58.3B on them since 2002, according to the DoD's latest assessment of its acquisition performance.
- Among the weapons scrapped were Boeing's (NYSE:BA) ground-based vehicle network for the Army, a Northrop Grumman (NYSE:NOC) mini-submarine for Navy SEALs and a chopper from Textron (NYSE:TXT) Bell Helicopter unit.
Wed, Oct. 26, 8:33 AM
- Net earnings of $602M, or $3.35 per diluted share vs. $516M, or $2.75 per diluted a year ago.
- Sales by segment: Aerospace +9%; Mission +1%; Technology flat.
- During the quarter, the company repurchased 2.2M shares of its common stock for $470M.
- Raised outlook for 2016: Diluted EPS of $11.55-$11.75 (from $10.75-$11.00), on sales of $23.1B-$24.1B (from $23.5B-$24B).
- NOC +1.8% premarket
- Q3 results
Wed, Oct. 26, 6:47 AM
Tue, Oct. 25, 6:47 PM
- Northrop Grumman's (NYSE:NOC) winning bid to develop and build the U.S. Air Force's new bomber held “significant structural advantages” over a competing proposal by Boeing (NYSE:BA) and Lockheed Martin (NYSE:LMT), according to a declassified version of a February ruling from the Government Accountability Office.
- The “significantly lower proposed prices” for initial production “created a near-insurmountable obstacle” to Boeing in the Air Force’s calculation of realistic costs, according to the GAO report, which also said its review of Boeing’s protest filed after the award to NOC "provides no basis on which to sustain the protest.”
- After rejecting Boeing’s challenge for the bomber program valued at as much as $80B, the GAO initially had kept its findings secret.
Tue, Oct. 25, 5:36 PM
- Lockheed Martin (NYSE:LMT) soared 7.3% in the stock's best showing in seven years, after Q3 results easily topped Wall Street estimates and the company raised its full-year outlook.
- LMT's "outlook for 7% revenue growth next year is pretty impressive," says Bloomberg aerospace and defense analyst Douglas Rothacker. “You’d be hard-pressed to find a defense contractor generating growth like that.”
- "The aging of equipment in allied countries, coupled with an expanding level of global security needs, are creating significant demand for our portfolio of products in multiple regions around the world," CEO Marillyn Hewson said during today's earnings conference call.
- Overall, Hewson says LMT's biggest growth area remains the F-35 followed by missile defense; only 10 F-35s were produced in Q3 vs. 12 for the year-ago quarter, which management attributes to a problem with the insulation in the plane's fuel lines and fuel tanks, and the subsequent fix.
- Other defense stocks rose today on the back of LMT's positive results; NOC +1.4% and RTN +1.5% are due to report quarterly results later this week.
Tue, Oct. 25, 5:30 PM
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Thu, Oct. 6, 3:53 PM
- Northrop Grumman (NOC +0.8%) is initiated with an Outperform rating and $260 price target at Baird, which says NOC is the best growth profile stock in the large-cap defense space.
- The firm forecasts NOC revenue growth to accelerate to the mid-single digits during 2017-20, reflecting the ramp in several key platforms such as the F-35 ramp, Triton UAV, E-2D and the B-21 bomber.
- Baird believes rising defense budgets, strategic portfolio wins and a highly respected management team continue to make NOC an excellent portfolio stock, and says pullbacks should be bought for the long term.