NOC - Undervalued And Underestimated: Why Northrop Grumman Is A Buy
2024-03-26 21:41:50 ET
Summary
- I maintain a concentrated portfolio and believe that holding a number of high-conviction plays is a great way to build wealth.
- Northrop Grumman is one of my biggest dividend investments and has performed well in the past despite challenges in the defense sector.
- The company's innovation, robust backlog, and strategic positioning indicate resilience and growth potential, although budget uncertainties remain a concern.
Introduction
As most of my readers will know by now, I maintain a highly concentrated portfolio. Sometimes, this leads to some frustration, as people are annoyed that I don't own every company that I'm bullish on - I get that.
However, I believe in a concentrated portfolio because my opinion is that holding many small positions does not add much value. Currently, I hold 20 stocks in my dividend growth portfolio. While I'm diversified, I have a considerable amount of money in each play.
I believe that having a portfolio of many more holdings would not add value to my strategy. For example, if I had 1% of my portfolio in stock XYZ, it would not make much difference to the overall portfolio - unless that company were to return 15-20% per year (or better)....
Undervalued And Underestimated: Why Northrop Grumman Is A Buy