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Northrop (NOC) Q1 Earnings to Benefit From Segmental Growth
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Northrop Grumman Corp. (NOC - Free Report) is scheduled to release first-quarter 2020 results on Apr 29, before the opening bell. Sales growth in the company’s Aerospace Systems and Technology Services segment is likely to have contributed significantly to the top line.
Northrop Grumman surpassed the Zacks Consensus Estimate in the trailing four quarters, the average positive surprise being 11.48%.
Let's take a closer look at the factors likely to have influenced the company’s performance.
Aerospace Systems
The company’s Aerospace Systems segment has been a major revenue driver. Increased production of F-35 jets is expected to have boosted this unit’s top line. In 2019, Northrop Grumman won several multi-billion-dollar awards for large legacy franchise programs like F-35 and E2D. Benefits from these awards are also expected to have aided Aerospace Systems unit revenues in the soon-to-be-reported quarter.
With the Aerospace Systems unit constituting almost 41% of the company’s total revenues, growth of this unit plays a crucial role in driving Northrop Grumman’s quarterly results.
Northrop Grumman Corporation Price and EPS Surprise
In the recent past, competitive opportunities in airborne and ground-based radar system have created opportunity for enhanced growth of Northrop Grumman’s Mission Systems segment. The unit has been witnessing strong operating margin.
Moreover, stable revenues from legacy technology services businesses are expected to get reflected in the upcoming result, backed by the boom in the defense and intelligence market.
Q1 Backlog
Northrop Grumman has an impressive track record of witnessing a steady flow of orders from both Pentagon and its foreign allies, courtesy of the huge demand for its manned and unmanned aircraft and military radars. Notably, during the first quarter, the company won a handful of multi-million-dollar contracts. This is expected to get reflected in the company's backlog count.
Earnings & Revenue Estimates
With the majority of its segments reflecting top-line growth in the first quarter, we are optimistic about Northrop Grumman’s overall performance. Evidently, the Zacks Consensus Estimate for the company’s first-quarter sales is pegged at $8.47 billion, indicating 3.5% growth from the year-ago quarter’s reported figure.
Strong program performance and cost synergies are expected to have boosted the company’s bottom line. The consensus mark for the company’s first-quarter earnings, pegged at $5.42 per share, indicates 3.5% improvement from the year-ago quarter’s reported figure.
What the Zacks Model Unveils
Our proven model predicts an earnings beat for Northrop Grumman this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Here are some defense companies you may want to consider as these also have the right combination of elements to post an earnings beat in their upcoming release:
Curtiss-Wright Corp. (CW - Free Report) has an Earnings ESP of +1.75% and a Zacks Rank #3. The company is scheduled to announce first-quarter 2020 earnings on May 6.
Huntington Ingalls Industries, Inc. (HII - Free Report) has an Earnings ESP of +1.79% and a Zacks Rank #3. The company will announce first-quarter 2020 earnings results on May 7.
Spirit AeroSystems Holdings (SPR - Free Report) has an Earnings ESP of +18.35% and a Zacks Rank #3. The company is set to announce first-quarter 2020 earnings on May 6.
More Stock News: This Is Bigger than the iPhone!
It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 27 billion devices in just 3 years, creating a $1.7 trillion market.
Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 6 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2020.
Image: Bigstock
Northrop (NOC) Q1 Earnings to Benefit From Segmental Growth
Northrop Grumman Corp. (NOC - Free Report) is scheduled to release first-quarter 2020 results on Apr 29, before the opening bell. Sales growth in the company’s Aerospace Systems and Technology Services segment is likely to have contributed significantly to the top line.
Northrop Grumman surpassed the Zacks Consensus Estimate in the trailing four quarters, the average positive surprise being 11.48%.
Let's take a closer look at the factors likely to have influenced the company’s performance.
Aerospace Systems
The company’s Aerospace Systems segment has been a major revenue driver. Increased production of F-35 jets is expected to have boosted this unit’s top line. In 2019, Northrop Grumman won several multi-billion-dollar awards for large legacy franchise programs like F-35 and E2D. Benefits from these awards are also expected to have aided Aerospace Systems unit revenues in the soon-to-be-reported quarter.
With the Aerospace Systems unit constituting almost 41% of the company’s total revenues, growth of this unit plays a crucial role in driving Northrop Grumman’s quarterly results.
Northrop Grumman Corporation Price and EPS Surprise
Northrop Grumman Corporation price-eps-surprise | Northrop Grumman Corporation Quote
Other Segments
In the recent past, competitive opportunities in airborne and ground-based radar system have created opportunity for enhanced growth of Northrop Grumman’s Mission Systems segment. The unit has been witnessing strong operating margin.
Moreover, stable revenues from legacy technology services businesses are expected to get reflected in the upcoming result, backed by the boom in the defense and intelligence market.
Q1 Backlog
Northrop Grumman has an impressive track record of witnessing a steady flow of orders from both Pentagon and its foreign allies, courtesy of the huge demand for its manned and unmanned aircraft and military radars. Notably, during the first quarter, the company won a handful of multi-million-dollar contracts. This is expected to get reflected in the company's backlog count.
Earnings & Revenue Estimates
With the majority of its segments reflecting top-line growth in the first quarter, we are optimistic about Northrop Grumman’s overall performance. Evidently, the Zacks Consensus Estimate for the company’s first-quarter sales is pegged at $8.47 billion, indicating 3.5% growth from the year-ago quarter’s reported figure.
Strong program performance and cost synergies are expected to have boosted the company’s bottom line. The consensus mark for the company’s first-quarter earnings, pegged at $5.42 per share, indicates 3.5% improvement from the year-ago quarter’s reported figure.
What the Zacks Model Unveils
Our proven model predicts an earnings beat for Northrop Grumman this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Northrop Grumman has an Earnings ESP of +1.66% and a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.
Other Stocks to Consider
Here are some defense companies you may want to consider as these also have the right combination of elements to post an earnings beat in their upcoming release:
Curtiss-Wright Corp. (CW - Free Report) has an Earnings ESP of +1.75% and a Zacks Rank #3. The company is scheduled to announce first-quarter 2020 earnings on May 6.
Huntington Ingalls Industries, Inc. (HII - Free Report) has an Earnings ESP of +1.79% and a Zacks Rank #3. The company will announce first-quarter 2020 earnings results on May 7.
Spirit AeroSystems Holdings (SPR - Free Report) has an Earnings ESP of +18.35% and a Zacks Rank #3. The company is set to announce first-quarter 2020 earnings on May 6.
More Stock News: This Is Bigger than the iPhone!
It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 27 billion devices in just 3 years, creating a $1.7 trillion market.
Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 6 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2020.
Click here for the 6 trades >>