Return on Equity (ROE)
since 2005
Calculation
Northrop Grumman Corp., ROE, long-term trends, calculation
| ROE | = | 100 | × | Net earnings (loss)1 | ÷ | Shareholders’ equity1 | |
|---|---|---|---|---|---|---|---|
| Dec 31, 2022 | 31.97% | = | 100 | × | 4,896) | ÷ | 15,312) |
| Dec 31, 2021 | 54.19% | = | 100 | × | 7,005) | ÷ | 12,926) |
| Dec 31, 2020 | 30.14% | = | 100 | × | 3,189) | ÷ | 10,579) |
| Dec 31, 2019 | 25.49% | = | 100 | × | 2,248) | ÷ | 8,819) |
| Dec 31, 2018 | 39.44% | = | 100 | × | 3,229) | ÷ | 8,187) |
| Dec 31, 2017 | 28.59% | = | 100 | × | 2,015) | ÷ | 7,048) |
| Dec 31, 2016 | 41.83% | = | 100 | × | 2,200) | ÷ | 5,259) |
| Dec 31, 2015 | 36.04% | = | 100 | × | 1,990) | ÷ | 5,522) |
| Dec 31, 2014 | 28.60% | = | 100 | × | 2,069) | ÷ | 7,235) |
| Dec 31, 2013 | 18.38% | = | 100 | × | 1,952) | ÷ | 10,620) |
| Dec 31, 2012 | 20.79% | = | 100 | × | 1,978) | ÷ | 9,514) |
| Dec 31, 2011 | 20.49% | = | 100 | × | 2,118) | ÷ | 10,336) |
| Dec 31, 2010 | 15.14% | = | 100 | × | 2,053) | ÷ | 13,557) |
| Dec 31, 2009 | 13.29% | = | 100 | × | 1,686) | ÷ | 12,687) |
| Dec 31, 2008 | -10.59% | = | 100 | × | (1,262) | ÷ | 11,920) |
| Dec 31, 2007 | 10.12% | = | 100 | × | 1,790) | ÷ | 17,687) |
| Dec 31, 2006 | 9.28% | = | 100 | × | 1,542) | ÷ | 16,615) |
| Dec 31, 2005 | 8.32% | = | 100 | × | 1,400) | ÷ | 16,828) |
Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31), 10-K (reporting date: 2011-12-31), 10-K (reporting date: 2010-12-31), 10-K (reporting date: 2009-12-31), 10-K (reporting date: 2008-12-31), 10-K (reporting date: 2007-12-31), 10-K (reporting date: 2006-12-31), 10-K (reporting date: 2005-12-31).
1 US$ in millions
Analysis of return on equity (ROE) from 2005 to 2022 reveals a trajectory characterized by early stability, a significant disruption in 2008, and a subsequent period of substantial growth and volatility.
- Impact of the 2008 Financial Downturn
- A sharp contraction in performance occurred in 2008, where net earnings fell to a loss of 1,262 million US dollars, resulting in a negative ROE of -10.59%. This period was accompanied by a reduction in shareholders' equity from 17,687 million US dollars in 2007 to 11,920 million US dollars in 2008.
- ROE Expansion and Equity Optimization (2009-2016)
- Following the 2008 loss, ROE entered a period of consistent escalation, rising from 13.29% in 2009 to a peak of 41.83% in 2016. This trend was driven by a combination of recovering net earnings and a steady decrease in shareholders' equity, which reached its lowest point of 5,259 million US dollars in 2016, thereby mathematically amplifying the return ratio.
- Recent Earnings Volatility and Peak Performance (2017-2022)
- The period between 2017 and 2022 is marked by high earnings volatility and a general rebuilding of the equity base. Shareholders' equity increased steadily from 7,048 million US dollars in 2017 to 15,312 million US dollars by 2022. Despite this increase in the equity denominator, ROE reached a historical maximum of 54.19% in 2021, coinciding with a peak in net earnings of 7,005 million US dollars. By 2022, ROE moderated to 31.97% as net earnings adjusted to 4,896 million US dollars.
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Comparison to Competitors
Northrop Grumman Corp., ROE, long-term trends, comparison to competitors
| Northrop Grumman Corp. | Boeing Co. | Caterpillar Inc. | Eaton Corp. plc | GE Aerospace | Honeywell International Inc. | Lockheed Martin Corp. | RTX Corp. | |
|---|---|---|---|---|---|---|---|---|
| Dec 31, 2022 | 31.97% | — | 42.25% | 14.45% | 0.62% | 29.74% | 61.86% | 7.16% |
| Dec 31, 2021 | 54.19% | — | 39.37% | 13.06% | -16.17% | 29.85% | 57.62% | 5.29% |
| Dec 31, 2020 | 30.14% | — | 19.56% | 9.44% | 16.04% | 27.23% | 113.60% | -4.88% |
| Dec 31, 2019 | 25.49% | — | 41.77% | 13.75% | -17.58% | 33.22% | 199.23% | 13.25% |
| Dec 31, 2018 | 39.44% | 3,085.55% | 43.79% | 13.32% | -72.16% | 37.21% | 361.98% | 13.70% |
| Dec 31, 2017 | 28.59% | 2,309.01% | 5.50% | 17.30% | -9.00% | 9.58% | — | 15.37% |
| Dec 31, 2016 | 41.83% | 599.14% | -0.51% | 12.90% | 11.65% | 24.83% | 350.89% | 18.33% |
| Dec 31, 2015 | 36.04% | 81.70% | 14.19% | 13.03% | -6.23% | 26.08% | 116.40% | 27.81% |
| Dec 31, 2014 | 28.60% | 62.85% | 22.06% | 11.36% | 11.89% | 24.01% | 106.29% | 19.93% |
| Dec 31, 2013 | 18.38% | 30.82% | 18.21% | 11.08% | 10.00% | 22.47% | 60.61% | 17.95% |
| Dec 31, 2012 | 20.79% | 66.47% | 32.40% | 8.07% | 11.09% | 22.55% | 7,038.46% | 19.80% |
| Dec 31, 2011 | 20.49% | 114.31% | 38.25% | 18.07% | 12.15% | 19.13% | 265.23% | 22.76% |
| Dec 31, 2010 | 15.14% | 119.56% | 24.94% | 12.62% | 9.79% | 18.96% | 78.91% | 20.45% |
| Dec 31, 2009 | 13.29% | 61.65% | 10.24% | 5.65% | 9.40% | 24.34% | 73.24% | 19.08% |
| Dec 31, 2008 | -10.59% | — | 58.44% | 16.75% | 16.63% | 38.85% | 112.29% | 29.46% |
| Dec 31, 2007 | 10.12% | 45.25% | 39.86% | 19.22% | 19.22% | 26.50% | 30.93% | 19.78% |
| Dec 31, 2006 | 9.28% | 46.74% | 51.57% | 23.14% | 18.55% | 21.43% | 36.74% | 21.58% |
| Dec 31, 2005 | 8.32% | 23.26% | 33.85% | 21.31% | 14.95% | 14.71% | 23.20% | 18.06% |
Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31), 10-K (reporting date: 2011-12-31), 10-K (reporting date: 2010-12-31), 10-K (reporting date: 2009-12-31), 10-K (reporting date: 2008-12-31), 10-K (reporting date: 2007-12-31), 10-K (reporting date: 2006-12-31), 10-K (reporting date: 2005-12-31).
Comparison to Sector (Capital Goods)
Northrop Grumman Corp., ROE, long-term trends, comparison to sector (capital goods)
| Northrop Grumman Corp. | Capital Goods | |
|---|---|---|
| Dec 31, 2022 | 31.97% | 13.39% |
| Dec 31, 2021 | 54.19% | 8.48% |
| Dec 31, 2020 | 30.14% | 4.42% |
| Dec 31, 2019 | 25.49% | 18.11% |
| Dec 31, 2018 | 39.44% | 11.28% |
| Dec 31, 2017 | 28.59% | 10.13% |
| Dec 31, 2016 | 41.83% | 20.08% |
| Dec 31, 2015 | 36.04% | 10.42% |
| Dec 31, 2014 | 28.60% | 18.16% |
| Dec 31, 2013 | 18.38% | 15.14% |
| Dec 31, 2012 | 20.79% | 17.58% |
| Dec 31, 2011 | 20.49% | 19.63% |
| Dec 31, 2010 | 15.14% | 15.88% |
| Dec 31, 2009 | 13.29% | 13.47% |
| Dec 31, 2008 | -10.59% | 24.97% |
| Dec 31, 2007 | 10.12% | 22.64% |
| Dec 31, 2006 | 9.28% | 22.16% |
| Dec 31, 2005 | 8.32% | 17.27% |
Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31), 10-K (reporting date: 2011-12-31), 10-K (reporting date: 2010-12-31), 10-K (reporting date: 2009-12-31), 10-K (reporting date: 2008-12-31), 10-K (reporting date: 2007-12-31), 10-K (reporting date: 2006-12-31), 10-K (reporting date: 2005-12-31).
Comparison to Industry (Industrials)
Northrop Grumman Corp., ROE, long-term trends, comparison to industry (industrials)
| Northrop Grumman Corp. | Industrials | |
|---|---|---|
| Dec 31, 2022 | 31.97% | 15.38% |
| Dec 31, 2021 | 54.19% | 15.38% |
| Dec 31, 2020 | 30.14% | 0.24% |
| Dec 31, 2019 | 25.49% | 14.56% |
| Dec 31, 2018 | 39.44% | 17.95% |
| Dec 31, 2017 | 28.59% | 18.24% |
| Dec 31, 2016 | 41.83% | 21.69% |
| Dec 31, 2015 | 36.04% | 16.11% |
| Dec 31, 2014 | 28.60% | 19.68% |
| Dec 31, 2013 | 18.38% | 16.40% |
| Dec 31, 2012 | 20.79% | 17.20% |
| Dec 31, 2011 | 20.49% | 20.10% |
| Dec 31, 2010 | 15.14% | 16.41% |
| Dec 31, 2009 | 13.29% | 12.84% |
| Dec 31, 2008 | -10.59% | 20.74% |
| Dec 31, 2007 | 10.12% | 20.36% |
| Dec 31, 2006 | 9.28% | 32.16% |
| Dec 31, 2005 | 8.32% | 7.80% |
Based on: 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31), 10-K (reporting date: 2011-12-31), 10-K (reporting date: 2010-12-31), 10-K (reporting date: 2009-12-31), 10-K (reporting date: 2008-12-31), 10-K (reporting date: 2007-12-31), 10-K (reporting date: 2006-12-31), 10-K (reporting date: 2005-12-31).