Key Takeaways Global defense spending is set to hit $2.6T by 2026, helping Aerospace & Defense stocks to outperform.LMT, RTX and NOC posted resilient Q4 results, supported by strong revenues and record backlogs.ETFs like ITA, XAR and PPA offer diversified exposure to rising defense budgets and earnings momentum.Geopolitical tensions have accounted for the bulk of market volatility so far in 2026, from U.S. military actions in Syria and Venezuela earlier in January to renewed risk of an escalating U.S.-Iran ...

Modern aircraft hangar with a stealth fighter jet beside a large aircraft fuselage section, aerospace defense setting. Key Points Defense stocks soared in 2025, and many of the industry's biggest players just reported their year-end results. Northrop Grumman and RTX gained positive reactions from their releases, with shares and price targets rising. Despite shares falling, analysts are still optimistic on General Dynamics. Interested in Northrop Grumman Corporation? Here are five stocks we like better ...

January 30, 2026 11:00 AM GMT Aerospace & Defense | North America Flyby: Record $530bn Defense Backlog Fuels Growth With aggregate Defense Prime backlog at an all-time high of ~ $530bn, we take stock of trends in backlog and revenue growth, which support our Attractive view of the Defense sector. Defense Backlog Predicts Topline Growth What stood out to us in the 4Q25 earnings results so far is that U.S. Defense companies are reporting record backlog levels. Aggregate Defense Prime backlog stands at a recor ...

Northrop Grumman Corporation (NOC) Stock Analysis and Price Target UpdateNorthrop Grumman Corporation (NYSE: NOC) is a leading global aerospace and defense technology company. It provides innovative systems, products, and solutions in autonomous systems, cyber, C4ISR, space, strike, and logistics and modernization. The company competes with other major defense contractors like Lockheed Martin and Raytheon Technologies.On February 1, 2026, Jefferies set a price target of $690 for NOC. At that time, the stock ...

The financials support the setup. In Q3 2025, Lockheed Martin posted $18.6 billion in sales, $1.6 billion in net earnings, $6.95 in EPS, and $3.3 billion in free cash flow, while backlog climbed to a record $179 billion and full-year revenue guidance moved into the mid $74 billion range.Even after that run, its forward P/E of 19.68x is still below the broader aerospace and defense sector’s roughly 22.5x, which suggests investors are not paying an outsized premium for its growth and backlog visibility. Add i ...

Core Viewpoint - RBC Capital has raised the price target for Northrop Grumman (NOC) to $750 from $715 while maintaining an Outperform rating on the shares, indicating a positive outlook for the company [1] Financial Performance - Northrop Grumman reported strong Q4 results, achieving a 4% earnings per share (EPS) beat, reflecting robust financial performance [1] Future Outlook - The company's 2026 top-line guidance has potential for several sources of upside, including B-21 acceleration and F/A-XX programs, which are not currently factored into the existing guidance, suggesting a favorable setup for 2026 [1]

Summary of Key Points from the Conference Call Industry Overview - **Industry**: Global Aerospace & Defense - **Focus**: US Defense Stocks and Budget Outlook for 2026 and Beyond Core Insights and Arguments 1. **Performance of Defense Stocks**: US defense stocks outperformed in early 2026 amid rising geopolitical tensions and President Trump's proposed $1.5 trillion defense budget for 2027, although uncertainty remains high [1][7] 2. **Budget Dynamics**: The 2026 DoD Appropriations Bill has been drafted, increasing investment funding by 27% compared to 2025, marking the largest increase in over 20 years. However, there are concerns regarding the clarity of future budgets beyond 2026 [4][24] 3. **Geopolitical Tensions**: Recent geopolitical events have calmed but remain a significant factor influencing defense budgets. Ongoing threats from countries like Iran, China, and Russia continue to exert upward pressure on defense spending [4][17][18] 4. **Executive Orders Impact**: President Trump's Executive Order restricts defense companies from share repurchases and limits executive compensation, which could pose short-term risks to stock prices [20][21] 5. **Future Budget Projections**: The proposed $1.5 trillion budget for 2027 is viewed as unlikely, with expectations for a budget increase but significant challenges in gaining Congressional support [22][23] Company-Specific Insights L3Harris - **Rating**: Outperform, Target Price: $398 - **Strengths**: High growth areas in space and rocket propulsion, strong margins in Communication Systems, and rising backlogs [8][34] - **Recent Developments**: Plans to spin off the Missile Solutions business through an IPO, supported by a $1 billion investment from the US government [35][36] Northrop Grumman (NOC) - **Rating**: Market-Perform, Target Price: $727 - **Strengths**: Strong positioning in nuclear deterrence and next-gen space programs, with growth expected from B-21 and other key programs [39] - **Challenges**: Issues with big programs and delays affecting growth potential [39] Lockheed Martin (LMT) - **Rating**: Market-Perform, Target Price: $586 - **Strengths**: High growth in Missiles & Fire Control, demand for tactical missiles [41] - **Concerns**: Execution issues and slower growth outlook due to challenges in the F-35 program [41][42] General Dynamics (GD) - **Rating**: Market-Perform, Target Price: $398 - **Strengths**: Rising demand for Navy shipbuilding and strong performance in Gulfstream business jets [46][47] - **Challenges**: Supply chain issues affecting throughput and margins [47] Raytheon (RTX) - **Rating**: Market-Perform, Target Price: $189 - **Strengths**: Growing backlog and international sales [54] - **Concerns**: Identified by President Trump as underperforming in meeting DoD demand [55] HII - **Rating**: Market-Perform, Target Price: $412 - **Strengths**: Improving shipbuilding outlook and strong backlog [49][51] - **Challenges**: Historical throughput disappointments and supply chain issues [50] Additional Important Points - **Investment Implications**: The overall dynamics are positive for defense stocks, but near-term risks related to executive orders and cash deployment policies could impact stock performance [7][33] - **Congressional Concerns**: There are significant questions regarding the Golden Dome funding and the new DoD acquisition strategy, with Congress demanding clarity on spending and performance metrics [26][27][28] This summary encapsulates the key points discussed in the conference call, highlighting the current state of the aerospace and defense industry, specific company insights, and broader implications for investors.

Key Takeaways Northrop Grumman is expanding its quantum role via investments and research ties, including a $12.5M pledge.NET is advancing post-quantum security with cryptography support in Zero Trust, protecting over 35% traffic.ARQQ launched Encryption Intelligence and landed pilot and multi-year telecom deals.The recently announced $1.8 billion acquisition of SkyWater Technology by IonQ (IONQ) marks a strategic inflection point in the evolution of the quantum computing industry. By bringing a U.S. semico ...

Northrop Grumman stealth drone in hangar at dusk, highlighting defense contractor NOC and military tech. Key Points Northrop Grumman’s early-2026 breakout from consolidation held up through post-earnings volatility, with buyers stepping in to defend the former resistance area as a new support level. Q4 results showed broad-based momentum, improving margins, and strong free cash flow—key drivers that support dividends and continued, meaningful share repurchases. 2026 guidance looks conservative relative ...

Northrop Grumman Corp (NYSE:NOC) reported upbeat fourth-quarter financial results and issued worse-than-expected FY26 outlook on Tuesday.Northrop Grumman reported quarterly earnings of $7.23 per share which beat the analyst consensus estimate of $6.97 per share. The company reported quarterly sales of $11.712 billion which beat the analyst consensus estimate of $11.626 billion.Northrop Grumman said it sees FY2026 adjusted EPS of $27.40-$27.90, versus market estimates of $28.85. The company expects sales of ...