Northrop Grumman (NYSE:NOC) Financial Strength

: 6 (As of Jun. 2023)

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Northrop Grumman has the Financial Strength Rank of 6.

GuruFocus Financial Strength Rank measures how strong a company's financial situation is. It is based on these factors:

1. The debt burden that the company has as measured by its Interest Coverage (current year). The higher, the better.
2. Debt to revenue ratio. The lower, the better.
3. Altman Z-Score.

Northrop Grumman's Interest Coverage for the quarter that ended in Jun. 2023 was 6.58. Northrop Grumman's debt to revenue ratio for the quarter that ended in Jun. 2023 was 0.41. As of today, Northrop Grumman's Altman Z-Score is 3.13.

Competitive Comparison

For the Aerospace & Defense subindustry, Northrop Grumman's Financial Strength, along with its competitors' market caps and Financial Strength data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.

Annual Data Quarterly Data

Northrop Grumman Financial Strength Distribution

For the Aerospace & Defense industry and Industrials sector, Northrop Grumman's Financial Strength distribution charts can be found below:

* The bar in red indicates where Northrop Grumman's Financial Strength falls in comparison to its industry or sector. The grey bar indicates the Financial Strength's extreme value range as defined by GuruFocus.

Northrop Grumman Financial Strength Calculation

GuruFocus Financial Strength Rank measures how strong a company's financial situation is. It is based on these factors

A company ranks high with financial strength is likely to withstand any business slowdowns and recessions.

1. The debt burden that the company has as measured by its Interest Coverage (current year). The higher, the better.

Note: If both Interest Expense and Interest Income are empty, while Net Interest Income is negative, then use Net Interest Income as Interest Expense.

Interest Coverage is a ratio that determines how easily a company can pay interest expenses on outstanding debt. It is calculated by dividing a company's Operating Income (EBIT) by its Interest Expense:

Northrop Grumman's Interest Expense for the months ended in Jun. 2023 was $-147 Mil. Its Operating Income for the months ended in Jun. 2023 was $967 Mil. And its Long-Term Debt & Capital Lease Obligation for the quarter that ended in Jun. 2023 was $15,568 Mil.

Northrop Grumman's Interest Coverage for the quarter that ended in Jun. 2023 is

Interest Coverage	=	-1	*	Operating Income (Q: Jun. 2023 )	/	Interest Expense (Q: Jun. 2023 )
	=	-1	*	967	/	-147
	=	6.58

The higher the ratio, the stronger the company's financial strength is.

2. Debt to revenue ratio. The lower, the better.

Northrop Grumman's Debt to Revenue Ratio for the quarter that ended in Jun. 2023 is

Debt to Revenue Ratio	=	Total Debt (Q: Jun. 2023 )			/	Revenue
	=	(Short-Term Debt & Capital Lease Obligation	+	Long-Term Debt & Capital Lease Obligation)	/	Revenue
	=	(0	+	15568)	/	38304
	=	0.41

3. Altman Z-Score.

Z-Score model is an accurate forecaster of failure up to two years prior to distress. It can be considered the assessment of the distress of industrial corporations.

The zones of discrimination were as such:

When Z-Score is less than 1.81, it is in Distress Zones.
When Z-Score is greater than 2.99, it is in Safe Zones.
When Z-Score is between 1.81 and 2.99, it is in Grey Zones.

Northrop Grumman has a Z-score of 3.13, indicating it is in Safe Zones. This implies the Z-Score is strong.

Good Sign:

Altman Z-score of 3.13 is strong.

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

Northrop Grumman (NYSE:NOC) Financial Strength Explanation

The maximum rank is 10. Companies with rank 7 or higher will be unlikely to fall into distressed situations. Companies with rank of 3 or less are likely in financial distress.

Northrop Grumman has the Financial Strength Rank of 6.

Northrop Grumman Financial Strength Related Terms

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Northrop Grumman (NYSE:NOC) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Industrials » Aerospace & Defense » Northrop Grumman Corp (NYSE:NOC) » Definitions » Financial Strength

Comparable Companies

Traded in Other Exchanges

NOC:Mexico NTH:Germany NTH:Germany NTH:Germany NOCG34:Brazil NOCO:Austria

Address

2980 Fairview Park Drive, Falls Church, VA, USA, 22042

Website

https://www.northropgrumman.com

Northrop Grumman is a diversified defense contractor providing aeronautics, defense, mission, and space systems. The company's aerospace segment creates the fuselage for the massive F-35 program and produces autonomous and piloted aircraft such as Global Hawk drones and the new B-21 bomber. Defense systems makes artillery and missile ammunition and guidance systems, missile defense systems, and conducts maintenance and upgrades on numerous military aircraft. Mission systems creates and integrates a variety of radar, navigation, and communication systems for avionics, weapons control, and countermeasures on a range of platforms from helicopters to destroyers. Finally, space systems produces satellites, sensors, space structures, and manufactures long-range missiles and rocket motors.

Executives

Mary A Winston	director	557 BROADWAY, C/O SCHOLASTIC CORP, NEW YORK NY 10012
Kimberly A. Ross	director	C/O AVON PRODUCTS,INC., 1345 AVENUE OF THE AMERICAS`, NEW YORK NY 10105-0196
Stephen F. O'bryan	officer: CVP Global Bus Dev Officer	2980 FAIRVIEW PARK DRIVE, FALLS CHURCH VA 22042
Arvind Krishna	director	IBM CORPORATION, ONE NEW ORCHARD RD, ARMONK NY 10504-1722
Roshan S Roeder	officer: CVP & Pres. Defense Systems	2980 FAIRVIEW PARK DRIVE, FALLS CHURCH VA 22042
Matthew Fox Bromberg	officer: CVP, Global Operations	2980 FAIRVIEW PARK DRIVE, FALLS CHURCH VA 22042
Wilson Thomas L Jr	officer: CVP and Pres. Space Systems	2980 FAIRVIEW PARK DRIVE, FALLS CHURCH VA 22042
Graham Robinson	director	1000 STANLEY DRIVE, NEW BRITAIN CT 06053
Thomas H Jones	officer: CVP & Pres Aeronautics Systems	2980 FAIRVIEW PARK DRIVE, FALLS CHURCH VA 22042
David P Abney	director	55 GLENLAKE PARWAY, NE, ATLANTA GA 30328
Marianne Catherine Brown	director	4094 TIMUQUANA ROAD, JACKSONVILLE FL 33210-8571
David F Keffer	officer: CVP & Chief Financial Officer	3170 FAIRVIEW PARK DRIVE, FALLS CHURCH VA 22042
Mary D Petryszyn	officer: CVP, Pres, Defense Systems	2980 FAIRVIEW PARK DRIVE, FALLS CHURCH VA 22042
Wesley G Bush	director, officer: Chairman	333 MAPLE AVENUE EAST, #3080, VIENNA VA 22180
Lucy C Ryan	officer: Corp VP, Communications	2980 FAIRVIEW PARK DRIVE, FALLS CHURCH VA 22042