MeritValue

NORTHROP GRUMMAN CORP /DE/

NOCdata completeness 100%19 fiscal years on file

Data notes: no data for concept 'interestExpense'

The thesis, from the filings

NORTHROP GRUMMAN CORP /DE/ earns about 11% on invested capital, comfortably above its ~9% cost of capital, and has bought back 11% of its shares over 5 years — the marks of a durable business run for its owners. The estimate methods put fair value between $161.3 and $301.37 a share.Whether it’s worth owning at today’s price is the last question — and yours to answer, below.

i. The business — what you’d actually own
FigureFY 2021FY 2022FY 2023FY 2024FY 2025
Revenue$35.7B1$36.6B2$39.3B3$41B3$42B3
Net income$7.01B4$4.9B5$2.06B6$4.17B6$4.18B6
Operating cash flow$3.57B7$2.9B8$3.88B9$4.39B9$4.76B9
Capital expenditure$1.42B10$1.44B11$1.78B12$1.77B12$1.45B12
Free cash flow (derived)$2.15B7$1.47B8$2.1B9$2.62B9$3.31B9
Total debt$25.6B13$25.8B14$27.7B15$32.5B16$31.4B16
Cash & equivalents$3.53B17$2.58B17$3.11B17$4.35B18$4.4B18
Diluted shares160.9M155.6M152.0M147.3M143.8M

Superscripts are receipts. Each links to the SEC filing the number came from (full list at the bottom).

ii. Your slice — ownership made literal
If you owned
shares
Net assets behind them
$1,159.53
your share of equity
Profit it earned you last year
$290.82
Free cash flow it threw off
$229.97
Debt you’d be carrying
$2,183.03

10 shares is a claim on $1,159.53 of net worth that earned you $290.82 and generated $229.97 of cash last year, against $2,183.03 of debt.

iii. Is this a good business?
Moat signal · return on invested capital
11% avg · 5y
FY21 20%FY22 13%FY23 5%FY24 10%FY25 10%

It earned about 11% on invested capital against a ~9% cost of capital — comfortably above the cost of funding, a moderate advantage.

seeing a moat in the numbers →
Management signal · capital allocation
−11% shares · 5y

Share count is down 11% over 5 years — management has been buying back stock, quietly handing owners a bigger slice. Total debt has risen 23% over the same window.

reading capital allocation →

Signals, not verdicts — read from the filings above. Numbers don’t prove a moat; they show its footprint. You decide.

iv. What it’s worth — engine v0.1.0

The 3 estimate methods that apply put fair value between $161.3 and $301.37 a share. They rest on different assumptions, so where they diverge is the story; the Graham Number is a stricter floor, not a target.

DCF · Growth Exit 10Y
$214.26
assumptions (10)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • terminalGrowth2.5%
  • projectionYears10
  • fcfGrowth6.8%
  • fcfBase$2.62B
DCF · Growth Exit 5Y
$161.3
assumptions (10)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • terminalGrowth2.5%
  • projectionYears5
  • fcfGrowth6.8%
  • fcfBase$2.62B
Earnings Power Value
$301.37
assumptions (8)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • normalizedEarnings$4.18B
  • growthAssumed0.0%
Graham Number
$275.44
assumptions (1)
  • grahamMultiplier2250.0%

Different models answer different questions — which to trust when →

v. The price question — last, on purpose
Is today’s price fair?
See live price ↗
Type a price. The ledger answers.
Or set your own belief
FCF growth, next 5 years6.8%
Discount rate (WACC)8.93%
Terminal growth2.5%
At your growth, a share is worth $161.3
The three cases
Bear0.0%$72.73
Base6.8%$161.3
Bull11.8%$241.59

Bear/base/bull growth = 0% / filed history / history + 5pp. Type a price to see the return each case implies.

Default growth 6.8%= this company’s own filed history (median-to-median FCF CAGR, clamped 0–20%). Your adjustments are recorded anonymously. They become the “what do owners actually believe” dataset.

Sources — the receipts
  1. 10-K · period ending 2021-12-31 · accession 0001133421-24-000006 (Revenues)
  2. 10-K · period ending 2022-12-31 · accession 0001133421-25-000006 (Revenues)
  3. 10-K · period ending 2023-12-31 · accession 0001133421-26-000003 (Revenues)
  4. 10-K · period ending 2021-12-31 · accession 0001133421-24-000006 (NetIncomeLoss)
  5. 10-K · period ending 2022-12-31 · accession 0001133421-25-000006 (NetIncomeLoss)
  6. 10-K · period ending 2023-12-31 · accession 0001133421-26-000003 (NetIncomeLoss)
  7. 10-K · period ending 2021-12-31 · accession 0001133421-24-000006 (NetCashProvidedByUsedInOperatingActivities)
  8. 10-K · period ending 2022-12-31 · accession 0001133421-25-000006 (NetCashProvidedByUsedInOperatingActivities)
  9. 10-K · period ending 2023-12-31 · accession 0001133421-26-000003 (NetCashProvidedByUsedInOperatingActivities)
  10. 10-K · period ending 2021-12-31 · accession 0001133421-24-000006 (PaymentsToAcquirePropertyPlantAndEquipment)
  11. 10-K · period ending 2022-12-31 · accession 0001133421-25-000006 (PaymentsToAcquirePropertyPlantAndEquipment)
  12. 10-K · period ending 2023-12-31 · accession 0001133421-26-000003 (PaymentsToAcquirePropertyPlantAndEquipment)
  13. 10-K · period ending 2021-12-31 · accession 0001133421-23-000006 (LongTermDebtNoncurrent)
  14. 10-K · period ending 2022-12-31 · accession 0001133421-24-000006 (LongTermDebtNoncurrent)
  15. 10-K · period ending 2023-12-31 · accession 0001133421-25-000006 (LongTermDebtNoncurrent)
  16. 10-K · period ending 2024-12-31 · accession 0001133421-26-000003 (LongTermDebtNoncurrent)
  17. 10-K · period ending 2021-12-31 · accession 0001133421-24-000006 (CashAndCashEquivalentsAtCarryingValue)
  18. 10-K · period ending 2024-12-31 · accession 0001133421-26-000003 (CashAndCashEquivalentsAtCarryingValue)