Northrop Grumman (NOC) Stock Forecast & Price Target

Northrop Grumman demonstrated robust financial performance with total sales of $10.4 billion in 2Q25, reflecting a 1% increase year-over-year and exceeding market expectations. The company's international sales surge of 32% year-over-year in 3Q25 and a year-to-date increase of 20% highlight the strong demand across all segments, particularly in Defense Systems, which experienced 55% growth in international sales. Additionally, the consistent growth in key segments such as Aeronautics Systems, driven by increased production of the B-21 and E-130J programs, underscores the company's expanding market presence and operational strength.

Northrop Grumman reported a free cash flow (FCF) of $637 million, reflecting a significant 42% year-over-year decline and falling short of the market's expectations of $1.13 billion. Sales growth was primarily driven by the Mission Systems segment, which increased by 14%, while the Space Systems segment experienced a 12% decrease, raising concerns about future performance. Additionally, uncertainties surrounding defense budget cuts, potential program cancellations, and competitive pressures contribute to a negative outlook, leading investors to speculate on the likelihood of the company lowering its 2025 guidance.