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How New Long-Term Munitions and Propulsion Contracts At Northrop Grumman (NOC) Have Changed Its Investment Story

Simply Wall St · 23h ago
  • Recently, Northrop Grumman secured multiple long-term U.S. defense contracts worth over US$300,000,000, including a firm-fixed-price, IDIQ SiAW support deal running through 2034 and a major XM1211 proximity-fuzed ammunition award, while also showcasing rapid innovation in solid rocket motor manufacturing through its collaboration with Titomic.
  • At the same time, new positive analyst coverage and Northrop Grumman’s heavy investment in next-generation munitions and propulsion capacity highlight how contract wins are intersecting with technology advances to shape expectations about its role in future defense programs.
  • Now we’ll examine how the new multi-year U.S. Army XM1211 contract could influence Northrop Grumman’s existing investment narrative and outlook.

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Northrop Grumman Investment Narrative Recap

To own Northrop Grumman, you need to be comfortable with a thesis built on sustained U.S. and allied defense spending, long-cycle programs, and steady contract awards. The recent XM1211 and SiAW wins reinforce near term revenue visibility, but do not meaningfully change the key catalyst, which is execution on major programs like B 21 and Sentinel, or the main risk around cost control and fixed price contract exposure if large investments or ramp ups do not go to plan.

The new U.S. Army XM1211 proximity fuzed ammunition contract, worth over US$200,000,000, is especially relevant because it links directly to Northrop Grumman’s heavy investment in next generation munitions capacity. Together with its over US$1,000,000,000 in solid rocket motor spending and the SiAW support deal running through 2034, it underlines how future growth expectations depend on converting these capital intensive bets into profitable production at scale.

Yet, while these wins may look reassuring, investors should also be aware of the growing execution and cost overrun risk if fixed price programs...

Read the full narrative on Northrop Grumman (it's free!)

Northrop Grumman's narrative projects $47.5 billion revenue and $4.4 billion earnings by 2028. This requires 5.5% yearly revenue growth and roughly a $0.5 billion earnings increase from $3.9 billion today.

Uncover how Northrop Grumman's forecasts yield a $667.21 fair value, a 21% upside to its current price.

Exploring Other Perspectives

NOC Community Fair Values as at Dec 2025
NOC Community Fair Values as at Dec 2025

Three fair value estimates from the Simply Wall St Community span roughly US$499 to US$667, underlining how far apart individual views can be. When you weigh those against Northrop Grumman’s reliance on large U.S. defense programs as a core catalyst, it becomes even more important to compare several different scenarios for its future performance.

Explore 3 other fair value estimates on Northrop Grumman - why the stock might be worth as much as 21% more than the current price!

Build Your Own Northrop Grumman Narrative

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.