Northrop Grumman Corporation

(New York Stock Exchange)
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Slightly Bearish -15

TD Cowen cut target for Northrop Grumman stock to USD 540.00

Analyst downgrade AI-generated analysis

πŸ“ˆ Northrop Grumman reported Q2 revenue of USD 10.88 billion, up 5.10% year over year.

πŸ’° The company achieved adjusted earnings per share of USD 7.68 for the second quarter.

πŸ“¦ Order backlog increased to USD 105.00 billion, a 17% rise year over year.

πŸ“‰ TD Cowen cut its price target from USD 590.00 to USD 540.00 on October 9, 2026.

βš–οΈ Analysts retained a Hold rating despite the reduction in the price target.

⚠️ Defense Systems recorded a USD 68.00 million unfavorable adjustment for the Stand-in Attack Weapon program.

πŸš€ Space division cited cost pressure on the GEM 63XL program during the earnings call.

πŸ’΅ Management maintained free cash flow guidance of USD 3.10 billion to USD 3.50 billion for FY2026.

πŸ“… The company is scheduled to report Q3 results on October 20, 2026.

🏒 Northrop Grumman operates in the Industrials sector with a focus on Aerospace and Defense.

πŸ’° Market capitalization was approximately USD 68.3 billion as of October 9, 2026.

Bullish Signals
  • Northrop Grumman achieved second-quarter revenue growth of 5.10% year over year, reaching USD 10.88 billion.
  • The company's order backlog expanded to USD 105.00 billion, up 17% year over year, indicating strong future demand.
  • Management maintained adjusted free cash flow guidance of USD 3.10 billion to USD 3.50 billion for fiscal year 2026 despite cost pressures.
Risk Factors
  • TD Cowen lowered its price target from USD 590.00 to USD 540.00, citing program cost pressures.
  • Defense Systems incurred a USD 68.00 million unfavorable adjustment related to the Stand-in Attack Weapon program.
  • The Space division reported specific cost pressure on the GEM 63XL program during the earnings call.
Full Analysis
Northrop Grumman (NOC) reported second-quarter revenue of USD 10.88 billion, representing a 5.10% year-over-year increase, with adjusted earnings per share reaching USD 7.68. The company maintains a substantial order backlog of USD 105.00 billion, which rose 17% year over year, providing a robust foundation for future revenue despite current market fluctuations. Analyst firm TD Cowen recently lowered its price target for Northrop Grumman from USD 590.00 to USD 540.00 while retaining a Hold rating on October 9, 2026. This adjustment reflects concerns regarding program cost pressures specifically within the Defense Systems and Space sectors, including unfavorable adjustments tied to the Stand-in Attack Weapon program. Despite the analyst downgrade, management maintained adjusted free cash flow guidance between USD 3.10 billion and USD 3.50 billion for fiscal year 2026. The company is scheduled to report third-quarter results on October 20, 2026, with investors closely watching whether the recent pattern of revenue growth persists alongside ongoing execution risks related to specific defense programs. Northrop Grumman's market capitalization stands at approximately USD 68.3 billion as of early October 2026. The stock trades in a complex environment where strong backlog numbers coexist with specific cost challenges, leading analysts to temper their price targets while acknowledging the long-term demand narrative remains intact.