Northrop Grumman prices $1 billion senior notes offering

FALLS CHURCH, Va. - Northrop Grumman Corporation (NYSE: NOC), a global aerospace and defense technology company with a market capitalization of $68.4 billion, announced the pricing of a $1.0 billion public offering of senior unsecured notes. The offering consists of two tranches: $500 million of 4.650% senior notes due 2030 and another $500 million of 5.250% senior notes due 2035. According to InvestingPro analysis, the company currently trades near its Fair Value, with analysts setting price targets up to $621.45.

The company plans to allocate the net proceeds from this offering for general corporate activities, which may encompass the repayment of existing debt, specifically its 7.875% and 7.750% senior notes that are due in 2026, share repurchases, and bolstering working capital. InvestingPro data shows Northrop Grumman operates with a moderate debt level, maintaining a healthy debt-to-equity ratio of 1.21 and an Altman Z-Score of 3.71, indicating strong financial health. The closing of the offering is anticipated on May 29, 2025, contingent on customary closing conditions being met.

The offering is being made through an effective shelf registration statement previously filed with the Securities and Exchange Commission (SEC). Interested parties can obtain copies of the prospectus supplement and the accompanying base prospectus by contacting the underwriters, which include Goldman Sachs & Co. LLC, Mizuho Securities USA LLC, and Morgan Stanley & Co. LLC, or by visiting the SEC’s EDGAR database online.

Northrop Grumman’s portfolio includes pioneering solutions that enable customers to connect and protect the world, as well as pushing human exploration across the universe. As a prominent player in the Aerospace & Defense industry, the company has maintained dividend payments for 55 consecutive years and has raised its dividend for 21 straight years, demonstrating strong financial stability. The company’s employees are committed to solving complex problems for their customers daily. For detailed analysis and more insights, check out the comprehensive Pro Research Report available on InvestingPro, which covers this and 1,400+ other top US stocks.

This press release includes forward-looking statements as defined by the Private Securities Litigation Reform Act of 1995, which involve risks and uncertainties that could cause actual results to differ materially from those projected or implied. These forward-looking statements are based on current expectations and assumptions and are subject to risks outlined in the company’s SEC filings, including its Form 10-K for the year ended December 31, 2024.

The information in this article is based on a press release statement and does not constitute an offer to sell or a solicitation of an offer to buy the securities described. The securities may not be sold in any jurisdiction where such an offer, solicitation, or sale would be unlawful prior to registration or qualification under the securities laws of that jurisdiction.

In other recent news, Northrop Grumman Corporation announced a 12 percent increase in its quarterly dividend, raising it to $2.31 per share. This marks the company’s 22nd consecutive annual dividend increase, reflecting its strong financial position and commitment to shareholder value. Additionally, Northrop Grumman, alongside Lockheed Martin and Peraton, secured a $244 million contract from the U.S. Space Command for the development of the Relay Ground Station. The contract, which is expected to be completed by April 2030, involves the design and integration of advanced hardware and software capabilities for space vehicle operations.

Furthermore, Northrop Grumman is poised to play a role in a potential $100 billion arms deal between the United States and Saudi Arabia, which could involve major U.S. defense firms. Analyst firms have been adjusting their outlook on Northrop Grumman, with BTIG lowering the stock target to $575 while maintaining a "Buy" rating, citing challenges with the B-21 bomber program. TD Cowen also revised its price target to $480, maintaining a "Hold" rating due to first-quarter performance shortfalls and potential risks in meeting sales projections.

Northrop Grumman’s first-quarter sales fell short of expectations, attributed to delays in material receipts and contract awards. Despite this, the company has maintained its full-year sales outlook, anticipating a significant sales increase in the second half of the year. Analysts express caution, noting limited room for error and potential adjustments in future guidance if delays persist.

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