Analysis of Solvency Ratios
Solvency ratios also known as long-term debt ratios measure a company ability to meet long-term obligations.
Solvency Ratios (Summary)
Northrop Grumman Corp., solvency ratios
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).
| Solvency ratio | Description | The company |
|---|---|---|
| Debt to equity ratio | A solvency ratio calculated as total debt divided by total shareholders’ equity. | Northrop Grumman Corp. debt to equity ratio improved from 2020 to 2021 and from 2021 to 2022. |
| Debt to equity ratio (including operating lease liability) | A solvency ratio calculated as total debt (including operating lease liability) divided by total shareholders’ equity. | Northrop Grumman Corp. debt to equity ratio (including operating lease liability) improved from 2020 to 2021 and from 2021 to 2022. |
| Debt to capital ratio | A solvency ratio calculated as total debt divided by total debt plus shareholders’ equity. | Northrop Grumman Corp. debt to capital ratio improved from 2020 to 2021 and from 2021 to 2022. |
| Debt to capital ratio (including operating lease liability) | A solvency ratio calculated as total debt (including operating lease liability) divided by total debt (including operating lease liability) plus shareholders’ equity. | Northrop Grumman Corp. debt to capital ratio (including operating lease liability) improved from 2020 to 2021 and from 2021 to 2022. |
| Debt to assets ratio | A solvency ratio calculated as total debt divided by total assets. | Northrop Grumman Corp. debt to assets ratio improved from 2020 to 2021 and from 2021 to 2022. |
| Debt to assets ratio (including operating lease liability) | A solvency ratio calculated as total debt (including operating lease liability) divided by total assets. | Northrop Grumman Corp. debt to assets ratio (including operating lease liability) improved from 2020 to 2021 and from 2021 to 2022. |
| Financial leverage ratio | A solvency ratio calculated as total assets divided by total shareholders’ equity. | Northrop Grumman Corp. financial leverage ratio decreased from 2020 to 2021 and from 2021 to 2022. |
| Solvency ratio | Description | The company |
|---|---|---|
| Interest coverage ratio | A solvency ratio calculated as EBIT divided by interest payments. | Northrop Grumman Corp. interest coverage ratio improved from 2020 to 2021 but then slightly deteriorated from 2021 to 2022. |
| Fixed charge coverage ratio | A solvency ratio calculated as earnings before fixed charges and tax divided by fixed charges. | Northrop Grumman Corp. fixed charge coverage ratio improved from 2020 to 2021 but then slightly deteriorated from 2021 to 2022 not reaching 2020 level. |
Debt to Equity
Northrop Grumman Corp., debt to equity calculation, comparison to benchmarks
| Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Current portion of long-term debt | 1,072) | 6) | 742) | 1,109) | 517) | |
| Long-term debt, net of current portion | 11,805) | 12,777) | 14,261) | 12,770) | 13,883) | |
| Total debt | 12,877) | 12,783) | 15,003) | 13,879) | 14,400) | |
| Shareholders’ equity | 15,312) | 12,926) | 10,579) | 8,819) | 8,187) | |
| Solvency Ratio | ||||||
| Debt to equity1 | 0.84 | 0.99 | 1.42 | 1.57 | 1.76 | |
| Benchmarks | ||||||
| Debt to Equity, Competitors2 | ||||||
| Boeing Co. | — | — | — | — | — | |
| Caterpillar Inc. | 2.33 | 2.29 | 2.42 | 2.58 | — | |
| Cummins Inc. | 0.88 | 0.49 | 0.52 | 0.32 | — | |
| Eaton Corp. plc | 0.51 | 0.52 | 0.54 | 0.52 | — | |
| General Electric Co. | 0.89 | 0.87 | 2.11 | 3.21 | — | |
| Honeywell International Inc. | 1.17 | 1.06 | 1.28 | 0.87 | — | |
| Lockheed Martin Corp. | 1.68 | 1.07 | 2.02 | 4.05 | — | |
| RTX Corp. | 0.44 | 0.43 | 0.44 | 1.04 | — | |
| Debt to Equity, Sector | ||||||
| Capital Goods | 1.30 | 1.22 | 1.68 | 1.97 | — | |
| Debt to Equity, Industry | ||||||
| Industrials | 1.30 | 1.22 | 1.68 | 1.79 | — | |
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).
1 2022 Calculation
Debt to equity = Total debt ÷ Shareholders’ equity
= 12,877 ÷ 15,312 = 0.84
2 Click competitor name to see calculations.
| Solvency ratio | Description | The company |
|---|---|---|
| Debt to equity ratio | A solvency ratio calculated as total debt divided by total shareholders’ equity. | Northrop Grumman Corp. debt to equity ratio improved from 2020 to 2021 and from 2021 to 2022. |
Debt to Equity (including Operating Lease Liability)
Northrop Grumman Corp., debt to equity (including operating lease liability) calculation, comparison to benchmarks
| Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Current portion of long-term debt | 1,072) | 6) | 742) | 1,109) | 517) | |
| Long-term debt, net of current portion | 11,805) | 12,777) | 14,261) | 12,770) | 13,883) | |
| Total debt | 12,877) | 12,783) | 15,003) | 13,879) | 14,400) | |
| Current operating lease liabilities (included in Other current liabilities) | 299) | 284) | 263) | 261) | —) | |
| Non-current operating lease liabilities | 1,824) | 1,590) | 1,343) | 1,308) | —) | |
| Total debt (including operating lease liability) | 15,000) | 14,657) | 16,609) | 15,448) | 14,400) | |
| Shareholders’ equity | 15,312) | 12,926) | 10,579) | 8,819) | 8,187) | |
| Solvency Ratio | ||||||
| Debt to equity (including operating lease liability)1 | 0.98 | 1.13 | 1.57 | 1.75 | 1.76 | |
| Benchmarks | ||||||
| Debt to Equity (including Operating Lease Liability), Competitors2 | ||||||
| Boeing Co. | — | — | — | — | — | |
| Caterpillar Inc. | 2.37 | 2.33 | 2.46 | 2.62 | — | |
| Cummins Inc. | 0.93 | 0.54 | 0.57 | 0.38 | — | |
| Eaton Corp. plc | 0.54 | 0.55 | 0.57 | 0.55 | — | |
| General Electric Co. | 0.96 | 0.94 | 2.20 | 3.32 | — | |
| Honeywell International Inc. | 1.23 | 1.11 | 1.32 | 0.90 | — | |
| Lockheed Martin Corp. | 1.81 | 1.19 | 2.21 | 4.40 | — | |
| RTX Corp. | 0.47 | 0.46 | 0.47 | 1.11 | — | |
| Debt to Equity (including Operating Lease Liability), Sector | ||||||
| Capital Goods | 1.36 | 1.28 | 1.75 | 2.06 | — | |
| Debt to Equity (including Operating Lease Liability), Industry | ||||||
| Industrials | 1.45 | 1.36 | 1.83 | 1.89 | — | |
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).
1 2022 Calculation
Debt to equity (including operating lease liability) = Total debt (including operating lease liability) ÷ Shareholders’ equity
= 15,000 ÷ 15,312 = 0.98
2 Click competitor name to see calculations.
| Solvency ratio | Description | The company |
|---|---|---|
| Debt to equity ratio (including operating lease liability) | A solvency ratio calculated as total debt (including operating lease liability) divided by total shareholders’ equity. | Northrop Grumman Corp. debt to equity ratio (including operating lease liability) improved from 2020 to 2021 and from 2021 to 2022. |
Debt to Capital
Northrop Grumman Corp., debt to capital calculation, comparison to benchmarks
| Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Current portion of long-term debt | 1,072) | 6) | 742) | 1,109) | 517) | |
| Long-term debt, net of current portion | 11,805) | 12,777) | 14,261) | 12,770) | 13,883) | |
| Total debt | 12,877) | 12,783) | 15,003) | 13,879) | 14,400) | |
| Shareholders’ equity | 15,312) | 12,926) | 10,579) | 8,819) | 8,187) | |
| Total capital | 28,189) | 25,709) | 25,582) | 22,698) | 22,587) | |
| Solvency Ratio | ||||||
| Debt to capital1 | 0.46 | 0.50 | 0.59 | 0.61 | 0.64 | |
| Benchmarks | ||||||
| Debt to Capital, Competitors2 | ||||||
| Boeing Co. | 1.39 | 1.35 | 1.40 | 1.46 | — | |
| Caterpillar Inc. | 0.70 | 0.70 | 0.71 | 0.72 | — | |
| Cummins Inc. | 0.47 | 0.33 | 0.34 | 0.24 | — | |
| Eaton Corp. plc | 0.34 | 0.34 | 0.35 | 0.34 | — | |
| General Electric Co. | 0.47 | 0.47 | 0.68 | 0.76 | — | |
| Honeywell International Inc. | 0.54 | 0.51 | 0.56 | 0.46 | — | |
| Lockheed Martin Corp. | 0.63 | 0.52 | 0.67 | 0.80 | — | |
| RTX Corp. | 0.31 | 0.30 | 0.31 | 0.51 | — | |
| Debt to Capital, Sector | ||||||
| Capital Goods | 0.57 | 0.55 | 0.63 | 0.66 | — | |
| Debt to Capital, Industry | ||||||
| Industrials | 0.57 | 0.55 | 0.63 | 0.64 | — | |
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).
1 2022 Calculation
Debt to capital = Total debt ÷ Total capital
= 12,877 ÷ 28,189 = 0.46
2 Click competitor name to see calculations.
| Solvency ratio | Description | The company |
|---|---|---|
| Debt to capital ratio | A solvency ratio calculated as total debt divided by total debt plus shareholders’ equity. | Northrop Grumman Corp. debt to capital ratio improved from 2020 to 2021 and from 2021 to 2022. |
Debt to Capital (including Operating Lease Liability)
Northrop Grumman Corp., debt to capital (including operating lease liability) calculation, comparison to benchmarks
| Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Current portion of long-term debt | 1,072) | 6) | 742) | 1,109) | 517) | |
| Long-term debt, net of current portion | 11,805) | 12,777) | 14,261) | 12,770) | 13,883) | |
| Total debt | 12,877) | 12,783) | 15,003) | 13,879) | 14,400) | |
| Current operating lease liabilities (included in Other current liabilities) | 299) | 284) | 263) | 261) | —) | |
| Non-current operating lease liabilities | 1,824) | 1,590) | 1,343) | 1,308) | —) | |
| Total debt (including operating lease liability) | 15,000) | 14,657) | 16,609) | 15,448) | 14,400) | |
| Shareholders’ equity | 15,312) | 12,926) | 10,579) | 8,819) | 8,187) | |
| Total capital (including operating lease liability) | 30,312) | 27,583) | 27,188) | 24,267) | 22,587) | |
| Solvency Ratio | ||||||
| Debt to capital (including operating lease liability)1 | 0.49 | 0.53 | 0.61 | 0.64 | 0.64 | |
| Benchmarks | ||||||
| Debt to Capital (including Operating Lease Liability), Competitors2 | ||||||
| Boeing Co. | 1.37 | 1.34 | 1.39 | 1.43 | — | |
| Caterpillar Inc. | 0.70 | 0.70 | 0.71 | 0.72 | — | |
| Cummins Inc. | 0.48 | 0.35 | 0.36 | 0.28 | — | |
| Eaton Corp. plc | 0.35 | 0.36 | 0.36 | 0.35 | — | |
| General Electric Co. | 0.49 | 0.49 | 0.69 | 0.77 | — | |
| Honeywell International Inc. | 0.55 | 0.53 | 0.57 | 0.47 | — | |
| Lockheed Martin Corp. | 0.64 | 0.54 | 0.69 | 0.81 | — | |
| RTX Corp. | 0.32 | 0.31 | 0.32 | 0.53 | — | |
| Debt to Capital (including Operating Lease Liability), Sector | ||||||
| Capital Goods | 0.58 | 0.56 | 0.64 | 0.67 | — | |
| Debt to Capital (including Operating Lease Liability), Industry | ||||||
| Industrials | 0.59 | 0.58 | 0.65 | 0.65 | — | |
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).
1 2022 Calculation
Debt to capital (including operating lease liability) = Total debt (including operating lease liability) ÷ Total capital (including operating lease liability)
= 15,000 ÷ 30,312 = 0.49
2 Click competitor name to see calculations.
| Solvency ratio | Description | The company |
|---|---|---|
| Debt to capital ratio (including operating lease liability) | A solvency ratio calculated as total debt (including operating lease liability) divided by total debt (including operating lease liability) plus shareholders’ equity. | Northrop Grumman Corp. debt to capital ratio (including operating lease liability) improved from 2020 to 2021 and from 2021 to 2022. |
Debt to Assets
Northrop Grumman Corp., debt to assets calculation, comparison to benchmarks
| Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Current portion of long-term debt | 1,072) | 6) | 742) | 1,109) | 517) | |
| Long-term debt, net of current portion | 11,805) | 12,777) | 14,261) | 12,770) | 13,883) | |
| Total debt | 12,877) | 12,783) | 15,003) | 13,879) | 14,400) | |
| Total assets | 43,755) | 42,579) | 44,469) | 41,089) | 37,653) | |
| Solvency Ratio | ||||||
| Debt to assets1 | 0.29 | 0.30 | 0.34 | 0.34 | 0.38 | |
| Benchmarks | ||||||
| Debt to Assets, Competitors2 | ||||||
| Boeing Co. | 0.42 | 0.42 | 0.42 | 0.20 | — | |
| Caterpillar Inc. | 0.45 | 0.46 | 0.47 | 0.48 | — | |
| Cummins Inc. | 0.26 | 0.18 | 0.18 | 0.12 | — | |
| Eaton Corp. plc | 0.25 | 0.25 | 0.25 | 0.25 | — | |
| General Electric Co. | 0.17 | 0.18 | 0.30 | 0.34 | — | |
| Honeywell International Inc. | 0.31 | 0.30 | 0.35 | 0.27 | — | |
| Lockheed Martin Corp. | 0.29 | 0.23 | 0.24 | 0.27 | — | |
| RTX Corp. | 0.20 | 0.20 | 0.20 | 0.31 | — | |
| Debt to Assets, Sector | ||||||
| Capital Goods | 0.28 | 0.27 | 0.31 | 0.31 | — | |
| Debt to Assets, Industry | ||||||
| Industrials | 0.29 | 0.29 | 0.32 | 0.32 | — | |
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).
1 2022 Calculation
Debt to assets = Total debt ÷ Total assets
= 12,877 ÷ 43,755 = 0.29
2 Click competitor name to see calculations.
| Solvency ratio | Description | The company |
|---|---|---|
| Debt to assets ratio | A solvency ratio calculated as total debt divided by total assets. | Northrop Grumman Corp. debt to assets ratio improved from 2020 to 2021 and from 2021 to 2022. |
Debt to Assets (including Operating Lease Liability)
Northrop Grumman Corp., debt to assets (including operating lease liability) calculation, comparison to benchmarks
| Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Current portion of long-term debt | 1,072) | 6) | 742) | 1,109) | 517) | |
| Long-term debt, net of current portion | 11,805) | 12,777) | 14,261) | 12,770) | 13,883) | |
| Total debt | 12,877) | 12,783) | 15,003) | 13,879) | 14,400) | |
| Current operating lease liabilities (included in Other current liabilities) | 299) | 284) | 263) | 261) | —) | |
| Non-current operating lease liabilities | 1,824) | 1,590) | 1,343) | 1,308) | —) | |
| Total debt (including operating lease liability) | 15,000) | 14,657) | 16,609) | 15,448) | 14,400) | |
| Total assets | 43,755) | 42,579) | 44,469) | 41,089) | 37,653) | |
| Solvency Ratio | ||||||
| Debt to assets (including operating lease liability)1 | 0.34 | 0.34 | 0.37 | 0.38 | 0.38 | |
| Benchmarks | ||||||
| Debt to Assets (including Operating Lease Liability), Competitors2 | ||||||
| Boeing Co. | 0.43 | 0.43 | 0.43 | 0.21 | — | |
| Caterpillar Inc. | 0.46 | 0.46 | 0.48 | 0.49 | — | |
| Cummins Inc. | 0.28 | 0.19 | 0.20 | 0.15 | — | |
| Eaton Corp. plc | 0.26 | 0.27 | 0.27 | 0.27 | — | |
| General Electric Co. | 0.19 | 0.19 | 0.31 | 0.35 | — | |
| Honeywell International Inc. | 0.33 | 0.32 | 0.36 | 0.28 | — | |
| Lockheed Martin Corp. | 0.32 | 0.26 | 0.26 | 0.29 | — | |
| RTX Corp. | 0.21 | 0.21 | 0.21 | 0.33 | — | |
| Debt to Assets (including Operating Lease Liability), Sector | ||||||
| Capital Goods | 0.29 | 0.29 | 0.32 | 0.32 | — | |
| Debt to Assets (including Operating Lease Liability), Industry | ||||||
| Industrials | 0.33 | 0.32 | 0.35 | 0.34 | — | |
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).
1 2022 Calculation
Debt to assets (including operating lease liability) = Total debt (including operating lease liability) ÷ Total assets
= 15,000 ÷ 43,755 = 0.34
2 Click competitor name to see calculations.
| Solvency ratio | Description | The company |
|---|---|---|
| Debt to assets ratio (including operating lease liability) | A solvency ratio calculated as total debt (including operating lease liability) divided by total assets. | Northrop Grumman Corp. debt to assets ratio (including operating lease liability) improved from 2020 to 2021 and from 2021 to 2022. |
Financial Leverage
Northrop Grumman Corp., financial leverage calculation, comparison to benchmarks
| Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Total assets | 43,755) | 42,579) | 44,469) | 41,089) | 37,653) | |
| Shareholders’ equity | 15,312) | 12,926) | 10,579) | 8,819) | 8,187) | |
| Solvency Ratio | ||||||
| Financial leverage1 | 2.86 | 3.29 | 4.20 | 4.66 | 4.60 | |
| Benchmarks | ||||||
| Financial Leverage, Competitors2 | ||||||
| Boeing Co. | — | — | — | — | — | |
| Caterpillar Inc. | 5.16 | 5.02 | 5.11 | 5.38 | — | |
| Cummins Inc. | 3.38 | 2.80 | 2.81 | 2.63 | — | |
| Eaton Corp. plc | 2.06 | 2.07 | 2.13 | 2.04 | — | |
| General Electric Co. | 5.16 | 4.93 | 7.13 | 9.40 | — | |
| Honeywell International Inc. | 3.73 | 3.47 | 3.68 | 3.17 | — | |
| Lockheed Martin Corp. | 5.71 | 4.64 | 8.43 | 15.20 | — | |
| RTX Corp. | 2.19 | 2.21 | 2.25 | 3.34 | — | |
| Financial Leverage, Sector | ||||||
| Capital Goods | 4.64 | 4.46 | 5.39 | 6.40 | — | |
| Financial Leverage, Industry | ||||||
| Industrials | 4.44 | 4.27 | 5.25 | 5.63 | — | |
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).
1 2022 Calculation
Financial leverage = Total assets ÷ Shareholders’ equity
= 43,755 ÷ 15,312 = 2.86
2 Click competitor name to see calculations.
| Solvency ratio | Description | The company |
|---|---|---|
| Financial leverage ratio | A solvency ratio calculated as total assets divided by total shareholders’ equity. | Northrop Grumman Corp. financial leverage ratio decreased from 2020 to 2021 and from 2021 to 2022. |
Interest Coverage
Northrop Grumman Corp., interest coverage calculation, comparison to benchmarks
| Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Net earnings | 4,896) | 7,005) | 3,189) | 2,248) | 3,229) | |
| Add: Income tax expense | 940) | 1,933) | 539) | 300) | 513) | |
| Add: Interest expense | 506) | 556) | 593) | 528) | 562) | |
| Earnings before interest and tax (EBIT) | 6,342) | 9,494) | 4,321) | 3,076) | 4,304) | |
| Solvency Ratio | ||||||
| Interest coverage1 | 12.53 | 17.08 | 7.29 | 5.83 | 7.66 | |
| Benchmarks | ||||||
| Interest Coverage, Competitors2 | ||||||
| Boeing Co. | -0.98 | -0.88 | -5.71 | -2.19 | — | |
| Caterpillar Inc. | 20.80 | 17.88 | 8.80 | 19.62 | — | |
| Cummins Inc. | 15.17 | 25.78 | 24.38 | 27.00 | — | |
| Eaton Corp. plc | 21.22 | 21.11 | 12.72 | 11.98 | — | |
| General Electric Co. | 1.88 | -0.96 | 2.59 | 1.27 | — | |
| Honeywell International Inc. | 16.41 | 22.09 | 17.75 | 22.17 | — | |
| Lockheed Martin Corp. | 11.72 | 14.27 | 14.93 | 12.09 | — | |
| RTX Corp. | 5.64 | 4.71 | -0.65 | 5.65 | — | |
| Interest Coverage, Sector | ||||||
| Capital Goods | 5.13 | 4.30 | 2.25 | 5.14 | — | |
| Interest Coverage, Industry | ||||||
| Industrials | 5.71 | 6.21 | 2.23 | 4.59 | — | |
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).
1 2022 Calculation
Interest coverage = EBIT ÷ Interest expense
= 6,342 ÷ 506 = 12.53
2 Click competitor name to see calculations.
| Solvency ratio | Description | The company |
|---|---|---|
| Interest coverage ratio | A solvency ratio calculated as EBIT divided by interest payments. | Northrop Grumman Corp. interest coverage ratio improved from 2020 to 2021 but then slightly deteriorated from 2021 to 2022. |
Fixed Charge Coverage
Northrop Grumman Corp., fixed charge coverage calculation, comparison to benchmarks
| Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Net earnings | 4,896) | 7,005) | 3,189) | 2,248) | 3,229) | |
| Add: Income tax expense | 940) | 1,933) | 539) | 300) | 513) | |
| Add: Interest expense | 506) | 556) | 593) | 528) | 562) | |
| Earnings before interest and tax (EBIT) | 6,342) | 9,494) | 4,321) | 3,076) | 4,304) | |
| Add: Operating lease cost | 332) | 315) | 320) | 318) | 375) | |
| Earnings before fixed charges and tax | 6,674) | 9,809) | 4,641) | 3,394) | 4,679) | |
| Interest expense | 506) | 556) | 593) | 528) | 562) | |
| Operating lease cost | 332) | 315) | 320) | 318) | 375) | |
| Fixed charges | 838) | 871) | 913) | 846) | 937) | |
| Solvency Ratio | ||||||
| Fixed charge coverage1 | 7.96 | 11.26 | 5.08 | 4.01 | 4.99 | |
| Benchmarks | ||||||
| Fixed Charge Coverage, Competitors2 | ||||||
| Boeing Co. | -0.70 | -0.64 | -4.75 | -1.19 | — | |
| Caterpillar Inc. | 14.92 | 12.73 | 6.58 | 13.01 | — | |
| Cummins Inc. | 8.85 | 10.72 | 9.60 | 9.94 | — | |
| Eaton Corp. plc | 10.01 | 10.40 | 6.24 | 7.45 | — | |
| General Electric Co. | 1.35 | -0.22 | 1.93 | 1.09 | — | |
| Honeywell International Inc. | 11.00 | 13.67 | 11.49 | 14.06 | — | |
| Lockheed Martin Corp. | 8.44 | 9.95 | 11.12 | 9.12 | — | |
| RTX Corp. | 4.40 | 3.66 | -0.22 | 4.31 | — | |
| Fixed Charge Coverage, Sector | ||||||
| Capital Goods | 3.79 | 3.26 | 1.84 | 3.80 | — | |
| Fixed Charge Coverage, Industry | ||||||
| Industrials | 3.68 | 4.04 | 1.71 | 3.07 | — | |
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).
1 2022 Calculation
Fixed charge coverage = Earnings before fixed charges and tax ÷ Fixed charges
= 6,674 ÷ 838 = 7.96
2 Click competitor name to see calculations.
| Solvency ratio | Description | The company |
|---|---|---|
| Fixed charge coverage ratio | A solvency ratio calculated as earnings before fixed charges and tax divided by fixed charges. | Northrop Grumman Corp. fixed charge coverage ratio improved from 2020 to 2021 but then slightly deteriorated from 2021 to 2022 not reaching 2020 level. |