Northrop Grumman Corporation (NOC)

Solvency ratios

Dec 31, 2023 Sep 30, 2023 Jun 30, 2023 Mar 31, 2023 Dec 31, 2022 Sep 30, 2022 Jun 30, 2022 Mar 31, 2022 Dec 31, 2021 Sep 30, 2021 Jun 30, 2021 Mar 31, 2021 Dec 31, 2020 Sep 30, 2020 Jun 30, 2020 Mar 31, 2020 Dec 31, 2019 Sep 30, 2019 Jun 30, 2019 Mar 31, 2019
Debt-to-assets ratio 0.30 0.31 0.30 0.31 0.27 0.28 0.31 0.31 0.30 0.30 0.30 0.31 0.32 0.32 0.33 0.33 0.31 0.37 0.39 0.37
Debt-to-capital ratio 0.48 0.46 0.47 0.48 0.44 0.46 0.48 0.49 0.50 0.53 0.53 0.55 0.57 0.58 0.59 0.61 0.59 0.61 0.63 0.63
Debt-to-equity ratio 0.93 0.87 0.89 0.91 0.77 0.85 0.94 0.97 0.99 1.12 1.14 1.21 1.35 1.36 1.47 1.58 1.45 1.56 1.67 1.69
Financial leverage ratio 3.15 2.82 2.95 2.92 2.86 3.06 3.07 3.15 3.29 3.71 3.77 3.94 4.20 4.28 4.48 4.77 4.66 4.17 4.30 4.55

The solvency ratios provide insights into Northrop Grumman Corp.'s ability to meet its long-term financial obligations.

The debt-to-assets ratio indicates the proportion of the company's assets financed by debt. Northrop Grumman's debt-to-assets ratio has remained relatively stable over the past year, hovering between 0.27 and 0.31, signaling that the company relies on debt to finance approximately 27% to 31% of its total assets.

The debt-to-capital ratio measures the proportion of the company's capital that is financed by debt. Northrop Grumman's debt-to-capital ratio has also shown stability, fluctuating between 0.44 and 0.49 over the same period, indicating that approximately 44% to 49% of the company's capital is derived from debt.

The debt-to-equity ratio compares the company's total debt to its shareholders' equity, illustrating the extent to which creditors and investors fund the company's assets. Northrop Grumman's debt-to-equity ratio has exhibited more variability, ranging from 0.77 to 0.97, implying that the company's total debt represents 77% to 97% of its shareholders' equity.

The financial leverage ratio evaluates the company's financial risk by measuring the extent to which it employs debt in its capital structure. Northrop Grumman's financial leverage ratio has also shown some fluctuations, with values ranging from 2.82 to 3.15, indicating that the company's assets are financed by equity and debt at varying degrees, with the ratio peaking at 3.15.

Overall, Northrop Grumman's solvency ratios suggest a consistent reliance on debt to finance its assets and capital, with the debt-to-equity ratio showing the most significant variability. This may indicate some level of financial risk, particularly as the financial leverage ratio has exhibited fluctuations, potentially reflecting variations in the company's financial risk exposure.

Coverage ratios

Dec 31, 2023 Sep 30, 2023 Jun 30, 2023 Mar 31, 2023 Dec 31, 2022 Sep 30, 2022 Jun 30, 2022 Mar 31, 2022 Dec 31, 2021 Sep 30, 2021 Jun 30, 2021 Mar 31, 2021 Dec 31, 2020 Sep 30, 2020 Jun 30, 2020 Mar 31, 2020 Dec 31, 2019 Sep 30, 2019 Jun 30, 2019 Mar 31, 2019
Interest coverage 4.66 7.14 7.07 7.27 7.12 6.62 6.87 6.98 10.16 10.40 9.92 9.56 6.85 7.19 7.55 7.70 7.52 6.99 7.27 6.94

The interest coverage ratio for Northrop Grumman Corp. has shown relatively consistent performance over the past eight quarters, ranging between 4.66 and 7.27. This ratio indicates the company's ability to meet its interest payments on its debt obligations. A higher interest coverage ratio suggests the company is more capable of meeting its interest obligations from its operating income.

The trend of the interest coverage ratio indicates that the company has generally been able to comfortably cover its interest expenses. Consistent ratios above 6 indicate a healthy ability to meet interest payments from operating profits. However, the slight fluctuations in the ratio may warrant further investigation into the company's financial management and debt structure to ensure sustainability in the long term.

See also:

Northrop Grumman Corporation Solvency Ratios (Quarterly Data)