Northrop Grumman dividend: history and cash cover
MyStockButler's October 2026 analysis: Northrop Grumman's forecast has dividends rising from $10.22 per share to $11.71 per share in the base case, while free cash flow covered 2025 dividends. Northrop Grumman's 2025 free cash flow of $3,307 million covered $2,917 million of dividends and buybacks, but dividends and buybacks exceeded free cash flow by $5,631 million across 2021–25.
How much does Northrop Grumman pay per share?
Dividends rise from $10.22 per share to $11.71 in the base case, using 7% annual growth matching the latest 7% increase. The bear case freezes the dividend for two years, while the bull case reaches $12.89 through stronger increases. Free cash flow covered 2025 dividends, and management expects $3,300–$3,700 million in 2027 adjusted free cash flow, but quarterly cash flow has been uneven.
| 2025 | 2024 | 2023 | 2022 | 2021 | |
|---|---|---|---|---|---|
| EPS, diluted | 29.08 | 28.34 | 13.53 | 31.47 | 43.54 |
| Real free cash flow per share | 22.17 | 17.11 | 13.24 | 8.79 | 12.79 |
| − Dividends paid, per share | 8.99 | 8.05 | 7.34 | 6.76 | 6.11 |
| − Share buybacks, per share | 11.29 | 17.07 | 9.87 | 9.67 | 23.03 |
What this means. The company's own free cash flow per share is higher in 2021 and 2022 because it adds money from equipment sold to customers, while our count leaves that out.
Is Northrop Grumman's dividend covered by its cash?
Across 2021–25, free cash flow totaled $11,646 million, while dividends and buybacks totaled $17,277 million. The $5,631 million gap had to come from cash balances, asset sales or borrowing. In 2021, shareholder payments were $4,688 million against free cash flow of $2,152 million. Businesses and assets sold brought in $3,484 million, while debt repayments used $2,236 million. That broadly matched management’s plan for the IT-sale proceeds.
The pattern continued in 2024. Shareholder payments were $3,700 million against $2,621 million of free cash flow, while new debt provided $2,495 million. In 2025, free cash flow of $3,307 million covered $2,917 million of dividends and buybacks. Northrop also received $333 million from selling its training-services business, raised $998 million net from debt issuance and repaid $1,500 million. Net debt ended 2025 at $11,293 million, above $9,253 million in 2021.
| 2025 | 2024 | 2023 | 2022 | 2021 | |
|---|---|---|---|---|---|
| Free cash flow | 3,307 | 2,621 | 2,100 | 1,466 | 2,152 |
| − Dividends paid | 1,293 | 1,186 | 1,116 | 1,052 | 983 |
| − Share buybacks | 1,624 | 2,514 | 1,500 | 1,504 | 3,705 |
| = Free cash flow not paid out | 390 | ||||
| = Paid out more than the free cash flow | 1,079 | 516 | 1,090 | 2,536 | |
| Paid out, % of free cash flow | 88.2% | 141.2% | 124.6% | 174.4% | 217.8% |
What this means. The company paid shareholders more cash than its business generated in several years, so it had to use savings, asset sales, or new borrowing to cover the difference.
What could change Northrop Grumman's dividend?
The view would move toward the bear case in 2027–2028 if B-21 provisions persist as production expands, or if Defense Systems margins weaken again. It would worsen through 2029 if capacity spending and delayed collections suppress free cash flow, raise debt and prevent buybacks.
| October 2027 | October 2028 | October 2029 | |
|---|---|---|---|
| Earnings | 4,315 (3,731 / 4,541) | 4,653 (3,760 / 5,100) | 5,011 (3,928 / 5,644) |
| Shares (millions) | 140 (142 / 140) | 139 (142 / 137) | 137 (142 / 135) |
| Dividends per share | 10.22 (9.88 / 10.46) | 10.94 (9.88 / 11.51) | 11.71 (10.18 / 12.89) |
| Price to earnings | 17.00 (14.50 / 18.50) | 17.50 (13.50 / 20.00) | 18.00 (13.00 / 21.50) |