Head to Head Analysis: Huntington Ingalls Industries (HII) & Northrop Grumman (NOC)

Northrop Grumman (NYSE: NOC) and Huntington Ingalls Industries (NYSE:HII) are both large-cap industrials companies, but which is the better stock? We will compare the two companies based on the strength of their institutional ownership, risk, valuation, profitability, earnings, analyst recommendations and dividends.

Profitability

This table compares Northrop Grumman and Huntington Ingalls Industries’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Northrop Grumman 9.88% 41.69% 9.89%
Huntington Ingalls Industries 8.31% 33.37% 8.90%

Volatility & Risk

Northrop Grumman has a beta of 0.69, indicating that its stock price is 31% less volatile than the S&P 500. Comparatively, Huntington Ingalls Industries has a beta of 1.18, indicating that its stock price is 18% more volatile than the S&P 500.

Dividends

Northrop Grumman pays an annual dividend of $4.00 per share and has a dividend yield of 1.3%. Huntington Ingalls Industries pays an annual dividend of $2.88 per share and has a dividend yield of 1.2%. Northrop Grumman pays out 29.8% of its earnings in the form of a dividend. Huntington Ingalls Industries pays out 21.7% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Northrop Grumman has raised its dividend for 10 consecutive years and Huntington Ingalls Industries has raised its dividend for 5 consecutive years. Northrop Grumman is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Insider & Institutional Ownership

81.1% of Northrop Grumman shares are owned by institutional investors. Comparatively, 84.0% of Huntington Ingalls Industries shares are owned by institutional investors. 0.7% of Northrop Grumman shares are owned by insiders. Comparatively, 2.2% of Huntington Ingalls Industries shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Earnings & Valuation

This table compares Northrop Grumman and Huntington Ingalls Industries’ revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Northrop Grumman $24.51 billion 2.20 $2.20 billion $13.42 23.05
Huntington Ingalls Industries $7.07 billion 1.52 $573.00 million $13.28 17.87

Northrop Grumman has higher revenue and earnings than Huntington Ingalls Industries. Huntington Ingalls Industries is trading at a lower price-to-earnings ratio than Northrop Grumman, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a breakdown of recent ratings and recommmendations for Northrop Grumman and Huntington Ingalls Industries, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Northrop Grumman 0 5 9 0 2.64
Huntington Ingalls Industries 2 3 2 0 2.00

Northrop Grumman presently has a consensus price target of $302.54, suggesting a potential downside of 2.17%. Huntington Ingalls Industries has a consensus price target of $212.67, suggesting a potential downside of 10.39%. Given Northrop Grumman’s stronger consensus rating and higher probable upside, research analysts plainly believe Northrop Grumman is more favorable than Huntington Ingalls Industries.

Summary

Northrop Grumman beats Huntington Ingalls Industries on 13 of the 17 factors compared between the two stocks.

About Northrop Grumman

Northrop Grumman Corporation is a global security company. The Company provides products, systems and solutions in autonomous systems; cyber; command, control, communications and computers, intelligence, surveillance and reconnaissance (C4ISR); strike, and logistics and modernization. The Company’s segments include Aerospace Systems, Mission Systems and Technology Services. The Company’s Aerospace Systems segment is engaged in the design, development, integration and production of manned aircraft, autonomous systems, spacecraft, high-energy laser systems, microelectronics and other systems/subsystems. The Mission Systems segment offers mission solutions and multifunction systems for Department of Defense (DoD), intelligence community, international, federal civil and commercial customers. The Technology Services segment provides logistics solutions supporting the full life cycle of platforms and systems for global defense and federal-civil customers.

About Huntington Ingalls Industries

Huntington Ingalls Industries, Inc. is a military shipbuilding company and a provider of professional services to partners in government and industry. The Company’s business consists of the design, construction, repair and maintenance of nuclear-powered ships and non-nuclear ships for the United States Navy and coastal defense surface ships for the United States Coast Guard, as well as the refueling and overhaul and inactivation of nuclear-powered ships for the United States Navy. It operates through three segments: Ingalls Shipbuilding (Ingalls), Newport News Shipbuilding (Newport News) and Technical Solutions. Its Ingalls segment includes its non-nuclear ship design, construction, repair and maintenance businesses. Its Newport News includes all of its nuclear ship design, construction, overhaul, refueling, and repair and maintenance businesses. Its Technical Solutions segment provides a range of professional services to the governmental, energy, and oil and gas markets.

Receive News & Ratings for Northrop Grumman Daily - Enter your email address below to receive a concise daily summary of the latest news and analysts' ratings for Northrop Grumman and related companies with MarketBeat.com's FREE daily email newsletter.

Latest News

Leave a Reply