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Analysis of Northrop Grumman and Raytheon

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Introduction

The purpose of this company analysis is to discover why one company would be better to invest in over the other. The analysis is based on two competing companies within the same industry. While these two companies compare in products and services, they do not relate in overall size. To assist in making an educating decision, many areas of each company were looked at. A comprehensive financial ratio analysis was completed for each company, as well as an evaluation of their strengths, weaknesses and future opportunities. While it is important to consider how a company manages its finances, it is equally important to consider its future prospects as well. Below you will find a brief description of each company, and an evaluation of their performance. All of this information will be concluded with which company may be the better investment prospect.

Raytheon

Raytheon is a company that specializes in defense, homeland security and other government markets globally. They are also one of the largest defense contractors in the world. The company has created a diverse product portfolio by running its operations through six separate divisions. These divisions include: missile systems (MS), integrated defense systems (IDS), network centric systems (NCS), space and airborne systems (SAS), intelligence and information systems (IIS), and technical services (TS) (Raytheon’s Website). The ability to be so diversified is considered a major strength for the company.

Another major plus for the company is their consistent financial performance. Raytheon has seen a steady increase in both revenues and gross profits in almost all of the last four years. The company has also seen a strong rise in its adjusted earning...

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...tp://www3.valueline.com.yosemite.wbu.edu/secure/vlispdf/stk1700/lookup.aspx

Gendler, I. (2011, June 17). The Value Line Investment Survey - Standard Edition - Lookup Company Reports. Value Line. Retrieved July 24, 2011, from http://www3.valueline.com.yosemite.wbu.edu/secure/vlispdf/stk1700/lookup.aspx

Northrop Grumman Corporation. (2010, August 20). Datamonitor 360. Retrieved July 24, 2011, from http://360.datamonitor.com.yosemite.wbu.edu/Product?pid=9D3EC0C0-911A-4E88-9064-4359FF254A52

Raytheon. (2010, August 19). Datamonitor 360. Retrieved July 24, 2011, from http://360.datamonitor.com.yosemite.wbu.edu/Product?pid=4B88005B-C9E0-41A1-B4DF-C98150C32AC

Raytheon Company : Investor Relations : Financials. (2011, March 1). Raytheon Company : Investor Relations : . Retrieved July 24, 2011, from http://investor.raytheon.com/phoenix.zhtml?c=84193&p=irol-reportsannual
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