Can Northrop Grumman's European Expansion Drive Growth?

Northrop Grumman NOC is expanding its presence in Central and Eastern Europe as NATO allies increase investments in air and missile defense, weapons and surveillance systems. The company’s growing regional engagement should help it benefit from Europe’s focus on strengthening defense capabilities and increasing local industrial capacity.

Northrop Grumman recently announced new industrial agreements in Poland and Estonia to support defense system integration, manufacturing and sustainment. In Estonia, the partnerships will support the Integrated Battle Command System (IBCS), strengthening the company’s role in European command-and-control modernization.

The company is also deepening its partnership with Poland’s Huta Stalowa Wola to support production, technology transfer and sustainment of Bushmaster Chain Guns used on Polish military vehicles. Such collaborations align with European efforts to expand domestic defense manufacturing and strengthen supply-chain resilience.

Northrop Grumman is further engaging with Poland on the E-2D Advanced Hawkeye, while its Raid Hunter system addresses growing threats from drones and cruise missiles. These initiatives expand the company’s exposure to several key areas of European defense modernization.

With NATO allies increasing defense investment and prioritizing interoperability, local production and advanced capabilities, Northrop Grumman is well-positioned to secure additional opportunities across the region. Its expanding partnerships and broad portfolio should support long-term growth in the European defense market.

Defense Stocks to Keep on the Radar

Other defense companies expanding their presence in Europe are discussed below:

Lockheed Martin LMT: Lockheed Martin is expanding F-35 production and sustainment in Europe through industrial partnerships. In 2025, the company and Rheinmetall opened a center in Germany to support F-35 center fuselage production, strengthening its European manufacturing footprint.

RTX Corporation RTX: RTX is expanding European missile-defense production through partnerships with local defense companies. In 2026, RTX and MBDA expanded cooperation to increase European production of advanced air-defense systems, supporting NATO’s growing demand for interceptors.

The Zacks Rundown for NOC

Shares of NOC have lost 5.7% in the past three months compared with the industry’s 7.6% decline.

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The company's shares are trading at a discount on a relative basis, with its forward 12-month Price/Sales being 1.60X compared with its industry’s average of 2.29X.

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The Zacks Consensus Estimate for NOC’s 2026 and 2027 earnings has moved north over the past 60 days.

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NOC stock currently carries a Zacks Rank #3 (Hold).

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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