BofA analyst Ronald Epstein lowered the firm’s price target on Northrop Grumman to $615 from $655 and keeps a Buy rating on the shares. Despite a “beat & raise quarter” and 9% topline growth, Northrop Grumman shares underperformed the market, which the firm attributes to both an “unfavorable trading day for defense” with rotation to cyclicals and growth as well as the market reaction to the news of the company not bidding as a prime for the sixth-gen fighter NGAD program. However, the firm understands Northrop’s “disciplined approach to avoid the ‘winner’s curse’,” arguing that NGAD may very well end up being a low volume, and therefore higher risk, program given a potential unit cost of about $300M per aircraft, the analyst tells investors.
Published first on TheFly – the ultimate source for real-time, market-moving breaking financial news. Try Now>>
See today’s best-performing stocks on TipRanks >>
Read More on NOC:
- Northrop Grumman price target lowered to $485 from $502 at Citi
- Northrop Grumman expects to return over 100% of adjusted FCF to shareholders
- Northrop Grumman sees FY23 effective tax rate ~17% vs. prior view of high 16%
- Northrop Grumman updates 2023 sector guidance
- Northrop Grumman Releases Second Quarter 2023 Financial Results