Northrop Grumman Q1 EPS $6.14 Beats Estimates but Lowers 2026 EPS Guidance
Northrop Grumman reported Q1 EPS of $6.14 and $9.88 billion in revenue, both exceeding estimates, but its full-year adjusted EPS guidance was lowered to $27.40–$27.90 versus a $28.01 consensus. Shares tumbled about 16% as investors weighed the softer outlook despite a UBS price target of $745 implying 26% upside.
1. Q1 Financial Results
Northrop Grumman reported first-quarter earnings per share of $6.14 and revenue of $9.88 billion, both surpassing consensus estimates of $6.09 and $9.75 billion. Sales growth of 4.36% year over year reflected strong demand in aeronautics, defense systems and space segments.
2. Full-Year EPS Guidance
Management set 2026 adjusted EPS guidance at $27.40 to $27.90, below the $28.01 analyst consensus, signaling muted margin expansion and a ramp-up year for key programs. Revenue outlook of $43.50 billion to $44.00 billion remains aligned with estimates.
3. Market Reaction
Shares declined approximately 16% on the guidance miss, leading sector weakness where peers GE Aerospace and RTX slid 4–7% after similar earnings beats without raising full-year outlooks. Investors focused on valuation concerns despite record backlogs.
4. Analyst Outlook
A UBS analyst raised the price target to $745, implying 26.35% upside, citing long-term government contracts and solid program backlogs. Analysts maintain moderate buy ratings, viewing the pullback as a buying opportunity given the company's defense order backlog.