Boeing vs Northrop Grumman Which Is Superior?

Boeing and Northrop Grumman are two of the biggest players in the aerospace and defense industry, with their stocks often closely watched by investors. Boeing, known for its commercial airplanes, has faced challenges in recent years with the grounding of its 737 MAX aircraft. Northrop Grumman, on the other hand, focuses on defense technology, including cybersecurity and missile defense systems. Both companies have strong government contracts, but differing market focuses that can impact their stock performance.

Boeing or Northrop Grumman?

When comparing Boeing and Northrop Grumman, different investors may prioritize various metrics based on their investment strategies and goals. So, ask yourself what type of investor you are. This will guide you in determining which metrics are most important for your investment decision between Boeing and Northrop Grumman.

Dividend Investors:

Dividend investors look for stable and growing income streams, using dividend metrics to assess potential investments. A company's dividend yield essentially measures the size of its dividend relative to the total market value of the company. Boeing has a dividend yield of -%, while Northrop Grumman has a dividend yield of 1.47%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. Boeing reports a 5-year dividend growth of 0.00% year and a payout ratio of 0.00%. On the other hand, Northrop Grumman reports a 5-year dividend growth of 9.33% year and a payout ratio of 49.22%.

Value Investors:

Value investors focus on financial metrics to determine a stock's intrinsic value compared to its market value. The Price-to-Earnings (P/E) Ratio links stock price to a company's earnings per share, with Boeing P/E ratio at -11.56 and Northrop Grumman's P/E ratio at 32.85. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. Boeing P/B ratio is -3.91 while Northrop Grumman's P/B ratio is 5.29.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, Boeing has seen a 5-year revenue growth of -0.26%, while Northrop Grumman's is 0.50%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with Boeing's ROE at 42.10% and Northrop Grumman's ROE at 16.36%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are $148.07 for Boeing and $532.93 for Northrop Grumman. Over the past year, Boeing's prices ranged from $144.13 to $267.54, with a yearly change of 85.62%. Northrop Grumman's prices fluctuated between $418.60 and $555.57, with a yearly change of 32.72%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.