Northrop Grumman

Methodology

Northrop Grumman's defense contracts and classified program backlog create exceptional earnings visibility from long-cycle government spending. The B-21 bomber and space systems provide multi-year revenue predictability. Government budget stability and strategic program positioning make earnings projections reliable across multiple years for this defense prime.

Methodology

Northrop typically trades at low PEG ratios reflecting the slower-growth nature of large defense contractors despite premium program content. The metric works for comparing against defense peers, though investors should normalize for pension and acquisition impacts. Strategic program wins like B-21 can justify valuation premiums beyond what current growth rates suggest.

Methodology

Northrop offers an attractive and growing dividend supported by predictable government contract cash flows, making PEGY more compelling than standalone PEG analysis. Management maintains disciplined capital returns with consistent dividend increases. The meaningful yield adds significant value for investors seeking stable income from defense exposure.