Citi Upgrades Northrop Grumman (NOC) to Buy

Citi analyst Jason Gursky upgraded Northrop Grumman (NYSE: NOC) from Neutral to Buy with a price target of $587.00.

The analyst comments: "We upgrade shares to Buy on compelling valuation given the roughly 15% sell off since the US Presidential election in November. In our view, investors have become too cautious on defense companies, including Northrop, on concerns about the trajectory of budgets and the potential policy/budget prescriptions of the Department of Government Efficiency. As noted in the introductory section of this report, recent overtures by the President-elect suggest he is not likely to take the US down an isolationist path, which in our view sets up for a better than feared budget environment. Further, efforts by DOGE could end up driving more revenue to contractors to the extent it seeks to reduce government headcount but doesn’t cut the number and scope of the missions being performed by current staff. These missions will need to be performed, and relying on the contractor base would become the likely outcome. And finally, Northrop is working on the recapitalization of two thirds of the nation’s nuclear deterrence assets – programs that have broad and deep support across DoD and Congress. In our view, this provides the company best-in-class revenue visibility."

For an analyst ratings summary and ratings history on Northrop Grumman click here. For more ratings news on Northrop Grumman click here.

Shares of Northrop Grumman closed at $482.38 yesterday.

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