Northrop Grumman stock forecast
MyStockButler's October 2026 analysis: The weighted scenario is $502.70 in October 2027, rising to $631.24 in October 2029; the bear case has a 25% probability, the base case 55%, and the bull case 20%. It hinges on profitable B-21 production, improving margins and cash conversion.
Where could Northrop Grumman's shares go?
The forecast points to a modest near-term loss, followed by improving returns if execution holds. The weighted October 2027 price is $502.70, implying a 4% total-return loss from today. It rises to $560.43 in October 2028, a 9% gain, and $631.24 in October 2029, a 24% gain.
The 2029 outcomes span $358.69 in the bear case to $901.97 in the bull case, against today’s $534.00. The probabilities are 25% bear, 55% base and 20% bull.
| Case | Probability | October 2027 | October 2028 | October 2029 |
|---|---|---|---|---|
| Bear | 25 % | 380.54 (-27 %) | 356.80 (-29 %) | 358.69 (-27 %) |
| Base | 55 % | 522.12 (-0 %) | 586.13 (+14 %) | 656.68 (+29 %) |
| Bull | 20 % | 601.98 (+15 %) | 744.29 (+43 %) | 901.97 (+75 %) |
| Weighted | 100 % | 502.70 (-4 %) | 560.43 (+9 %) | 631.24 (+24 %) |
What this means. The weighted row is the probability-based average of the bear, base, and bull estimates, not a separate prediction.
What has to go right for Northrop Grumman?
The bear case holds earnings near $3.7 billion because B-21 costs, supplier constraints and funding delays keep margins around 8%. The bull case reaches $5,644 million as funded orders convert faster and margins reach 10.3%. The assumptions follow management’s 5%–7% 2027 sales outlook and the $109,597 million backlog, of which $50,095 million was funded.
How much cash does Northrop Grumman really make?
In 2025, operating cash was $4,757 million against operating income of $4,511 million. After $1,450 million of capital spending, free cash flow was $3,307 million. Across 2021–2025, operating cash was approximately 94% of aggregate operating income, while free cash flow was approximately 56%.
| 2025 | 2024 | 2023 | 2022 | 2021 | |
|---|---|---|---|---|---|
| Cash from operations | 4,757 | 4,388 | 3,875 | 2,901 | 3,567 |
| − Capital spending | 1,450 | 1,767 | 1,775 | 1,435 | 1,415 |
| = Free cash flow | 3,307 | 2,621 | 2,100 | 1,466 | 2,152 |
| − Stock pay | 119 | 101 | 87 | 99 | 94 |
| = Real free cash flow | 3,188 | 2,520 | 2,013 | 1,367 | 2,058 |
What this means. The company's own free cash flow is higher in 2021 and 2022 because it adds back money from equipment sold to customers, while our count treats that money as already spent.
What does an investor pay for Northrop Grumman today?
The trailing price-to-earnings ratio, or P/E, compares the share price with earnings per share. Northrop’s P/E is 16.8x today, but those earnings depend partly on estimates of unfinished contracts. On a fixed-price contract, the customer agrees to pay a set amount. If Northrop expects $90 million of costs on a $100 million aircraft and later expects costs of $110 million, it must recognize an expected loss even before all the extra cash leaves the business. About half of Northrop’s 2025 sales came from fixed-price contracts, and the B-21 bomber produced another $477 million loss provision in 2025.
| Today (Oct 21, 2026) | |
|---|---|
| Share price | 534.00 |
| Market value (calculated) | 75,862.44 |
| Enterprise value (calculated) | 87,315.44 |
| P/E, last 12 months (calculated) | 16.8x |
| Free cash flow yield (calculated) | 4.4% |
| Real free cash flow yield (calculated) | 4.2% |
What this means. The table is dated October 21, but the share price is from October 20 and some other numbers use earlier dates, so the figures are not all measured on the same day.