General Dynamics Corporation (GD) vs Northrop Grumman Corporation (NOC)

General Dynamics Corporation and Northrop Grumman Corporation are both Aerospace & Defense companies. General Dynamics Corporation is the larger, with a market value of $91.2B against $72.4B — 1.3× the size. Northrop Grumman Corporation trades at the lower P/E: 16.2× against 20.3×. General Dynamics Corporation grew revenue faster over the last twelve months: 9.13% against 5.90%. Northrop Grumman Corporation has the higher net margin (10.5% vs 8.18%) and the lower return on invested capital (9.58% vs 11.8%). Both pay a dividend; General Dynamics Corporation yields more (2.08% vs 1.73%). Across the 23 metrics below, General Dynamics Corporation leads on 15 and Northrop Grumman Corporation on 8.

Valuation

Metric GD NOC Aerospace & Defense median
P/E 20.27 16.19 33.00
P/S 1.66 1.69 3.63
P/B 3.39 4.06 3.24
Price to free cash flow 14.11 19.90 34.01
EV/EBITDA 14.26 13.83 18.69
EV/Sales 1.72 1.97 3.94
Earnings yield 4.93% 6.18% 1.31%
Free cash flow yield 7.09% 5.03% 0.00%

Profitability

Metric GD NOC Aerospace & Defense median
Gross margin 15.38% 20.06% 25.48%
Operating margin 10.32% 10.72% 4.54%
Net margin 8.18% 10.48% 2.22%
Free cash flow margin 11.75% 8.50% 0.00%
Return on equity 17.80% 26.96% 6.43%
Return on assets 7.67% 8.97% 2.70%
Return on invested capital 11.79% 9.58% 1.56%

Growth

Metric GD NOC Aerospace & Defense median
Revenue growth (TTM) 9.13% 5.90% 18.43%
EPS growth (last fiscal year) 13.43% 2.61% —
Revenue growth, 5-year CAGR 6.74% 2.66% 9.62%
Net income growth, 5-year CAGR 5.86% 5.57% 0.00%

Health

Metric GD NOC Aerospace & Defense median
Debt to equity 0.28 0.81 0.24
Current ratio 1.44 1.17 2.72
Net debt to EBITDA 0.90 1.80 1.12

Dividend

Metric GD NOC Aerospace & Defense median
Dividend yield 2.08% 1.73% 1.04%
Payout ratio 0.42 0.23 0.00

Size

Metric GD NOC Aerospace & Defense median
Market cap 91.18b 72.35b 2.52b

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