Geneos Wealth Management Inc. has significantly reduced its investment in Northrop Grumman Corporation (NYSE:NOC), cutting its stake by 61.6% during the third quarter of 2023. According to a recent filing with the U.S. Securities and Exchange Commission (SEC), the firm now holds 943 shares of the aerospace giant, having sold 1,511 shares during this period. At the close of the most recent quarter, Geneos’s holdings in Northrop Grumman were valued at approximately $575,000.
Several other institutional investors have also adjusted their positions in Northrop Grumman. For instance, Parvin Asset Management LLC acquired a new stake valued at about $25,000 during the second quarter, while Twin Peaks Wealth Advisors LLC purchased shares worth approximately $31,000. NewSquare Capital LLC increased its holdings by 75.0%, now owning 63 shares valued at $31,000. Similarly, AlphaQuest LLC lifted its stake by 29.2% and City Holding Co. expanded its position by 138.1%, owning 100 shares valued at $50,000. Overall, institutional investors control 83.40% of the company’s stock.
Recent Insider Activity
In related developments, Northrop Grumman’s Director, Mark A. Welsh III, sold 97 shares of the company on November 24, 2023, at an average price of $564.08, totaling approximately $54,715.76. Following this transaction, Welsh retains 4,281 shares, valued at around $2,414,826.48. This sale reflects a 2.22% decrease in his ownership of the stock.
CEO Kathy J. Warden also sold 7,000 shares on January 5, 2024, for a total of $4,200,000. After this transaction, Warden holds 194,602 shares worth about $116,761,200, representing a 3.47% reduction in her stake. Over the past three months, insiders have sold a total of 10,097 shares valued at $6,099,716, with insiders now owning 0.23% of the company’s stock.
Northrop Grumman’s Financial Performance
On the market front, Northrop Grumman shares opened at $619.31 on Friday. The company boasts a market capitalization of $88.39 billion, with a price-to-earnings (P/E) ratio of 22.28 and a beta of 0.05. The stock’s performance has seen a 12-month low of $426.24 and a high of $640.90.
On October 21, 2023, Northrop Grumman reported quarterly earnings of $7.67 EPS, surpassing analysts’ expectations of $6.43 by $1.24. The firm generated revenue of $10.42 billion for the quarter, which was slightly below the forecast of $10.68 billion. Compared to the same quarter last year, revenue increased by 4.3%. Northrop Grumman has issued guidance for earnings per share (EPS) for fiscal year 2025, projecting between $25.650 and $26.050.
The company also declared a quarterly dividend of $2.31 per share, paid on December 17, 2023. Stockholders of record on December 1 received this payment, translating to an annualized dividend of $9.24 and a yield of 1.5%. The ex-dividend date was also set for December 1, with a dividend payout ratio of 33.24%.
In the context of recent government policy discussions, there has been a mix of sentiment influencing Northrop Grumman’s stock. President Donald Trump recently proposed a significant increase in defense spending to $1.5 trillion for the year 2027, which has boosted investor confidence in defense stocks, including Northrop Grumman.
The company secured a $94.3 million contract with the Navy for solid rocket motors, contributing positively to its revenue outlook. Additionally, Northrop Grumman is collaborating with Kratos on a project to develop collaborative combat aircraft for the Marine Corps, which is expected to enhance its future revenue streams.
Despite these positive developments, the company faces challenges, including potential regulatory constraints on stock buybacks and executive compensation introduced by the Trump administration. Such measures could impact shareholder returns and have led to some selling pressure in the market.
Analyst Forecasts and Company Outlook
Wall Street analysts maintain a generally positive outlook for Northrop Grumman. BNP Paribas recently upgraded the stock to a “strong-buy” rating. Morgan Stanley reaffirmed its “overweight” rating and set a price target of $714.00, while JPMorgan Chase & Co. adjusted its price target from $575.00 to $640.00 with a “neutral” rating.
As of now, the consensus rating for Northrop Grumman stands at “Moderate Buy,” with a consensus price target of $647.35. The company continues to demonstrate resilience and growth potential in the aerospace and defense sectors, making it a key player to watch in the coming months.
