Northrop Grumman Corp (NYSE:NOC)
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The Company provides technologically advanced, innovative products, services, and integrated solutions in information and services, aerospace, electronics, and shipbuilding to its global customers.
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This stock qualifies for my high stable dividends screen, which typically outperforms the S&P 500 by more than 10% per year. The idea of the screen is to look for stocks that meet the following criteria: (1) dividend yields above 2% (2) stock seems undervalued and (3) dividend appears to be sustainable or growing. I think that Mr. Market will reward this type of stock in the near future as investors flee bonds in search of higher yields. Stable stocks should look appealing given the uncertain economic future for developed economies. The current dividend yield of Northrop Grummon is about 3.1%. Current ROE is 14% and the stock is trading for just 9 times expected earnings. The current payout ratio is 0.3 and the five year average payout ratio is 0.3