The defence industry is viewed by many investors as an “evergreen” industry. After all, governments around the world tend to keep up their defence spending regardless of whether the country is facing an economic crisis or another extreme event. National security is paramount for the leaders of any country. This recession-proof aspect of the defence industry is one of the things that attract investors to the best aerospace stock they can find. Defence and aerospace are two closely linked areas within the defence. Among the top aerospace and defence stocks, Northrop Grumman is one of the leading companies. It is well-known for making strategic bombers like the B-2 and providing critical components for the F-35. Northrop Grumman also has a space segment that specializes in launch vehicles and spacecraft.
More About The Business Of Northrop Grumman
Northrop Grumman achieved sales figures of over $36 billion as compared to $23 billion in 2015. Its gross margins have sustained above 20% throughout the past decade, while earnings per share have increased significantly from $7.5 in 2011 to $19 in 2020. The company has increased its dividends every year over the past ten years, growing dividends per share from $1.97 in 2011 to $5.67 in 2020. The payout ratio has also been quite conservative, usually hovering around the 28% mark. Last year was the sole exception, with the payout ratio touching 37.7%. Northrop Grumman employs close to 90,000 people. As of 2020, the company had a backlog of $81 billion, a 25% rise in 1 year. Northrop Grumman is a top defence stock that has a solid business with growing dividend payments.
Northrop Grumman’s stock closed at $370 on 21st May 2021. The stock was up almost 8% over the preceding 30 days and was trading at a dividend yield of 1.7%. The 1-year return was subdued at around 13%. However, the stock had rallied about 30% since the end of January of 2021.