Goldman Sachs Fools Small Investors Again?

Analysts at Goldman Sachs had also identified the defense industry as a top performer in 2018. “Defense stocks should outperform again in 2018 as growth continues to exceed expectations,” said Goldman. The firm’s number one stock in the defense industry was Northrop Grumman Corporation (NYSE:NOC), for which it projected 10% average annual revenue growth over the next decade. Back in October 2017 Goldman had also heaped praise on Northrop Grumman, pointing to the company’s strong operating results and improved outlook.

Northrop Grumman Corporation (NYSE:NOC) stock continued its stellar performance during the first quarter, setting an all-time high of $360.88 in the beginning of April, up 14.5% from the day Goldman sent its note to investors and just shy of its 16% forecast. Everything went downhill on April 24, when Northrop Grumman Corporation (NYSE:NOC) published its first quarter financial report. Although the company surpassed Wall Street’s expectations for earnings and revenue, investors were also looking for an improved cash flow and sales guidance, which did not materialize. Northrop Grumman also said it was dropping out of the race for Air Force’s GPS 3 satellites contract. Since then, the stock has been falling and is now close to start-of-the-year level of $305 per share.