Northrop Grumman Corp (NYSE:NOC) shares are dipping Wednesday following President Donald Trump’s social media post blasting defense contractors over executive pay, dividends and sluggish production timelines.
Northrop Grumman stock is showing notable weakness. Why is NOC stock dropping?
What Happened: Trump has called for an immediate halt to dividends and stock buybacks until companies ramp up investment in manufacturing infrastructure and accelerate equipment deliveries on Truth Social.
The president accused defense firms of prioritizing “massive Dividends to their Shareholders and massive Stock Buybacks, at the expense and detriment of investing in Plants and Equipment,” warning that “This situation will no longer be allowed or tolerated!”
Trump also criticized executive compensation across the defense sector, describing pay packages as “exorbitant and unjustifiable given how slowly these Companies are delivering vital Equipment to our Military and our Allies.” Trump said executive pay will be capped at $5 million until defense contractors build new production facilities and improve their maintenance operations.
“Defense Companies are not producing our Great Military Equipment rapidly enough and, once produced, not maintaining it properly or quickly,” Trump stated. “From this moment forward, these Executives must build NEW and MODERN Production Plants.”
He also made it clear that defense firms won't be allowed to issue dividends or buy back stock until they resolve their production issues. Instead, he said those funds should be directed toward expanding manufacturing capacity rather than relying on banks or federal support.
NOC Price Action: Northrop Grumman shares were down 5.61% at $576.37 at the time of publication on Wednesday, according to Benzinga Pro.
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