Modelling A.I. in Economics

NOC Northrop Grumman Corporation Common Stock

Northrop Grumman Corporation Common Stock Research Report

Abstract

Outlook: Northrop Grumman Corporation Common Stock assigned short-term B1 & long-term Baa2 forecasted stock rating.
Rating: Buy
Time series to forecast n: 05 Dec 2022 for (n+3 month)

The prediction of stock price performance is a difficult and complex problem. Multivariate analytical techniques using both quantitative and qualitative variables have repeatedly been used to help form the basis of investor stock price expectations and, hence, influence investment decision making. However, the performance of multivariate analytical techniques is often less than conclusive and needs to be improved to more accurately forecast stock price performance. A neural network method has demonstrated its capability of addressing complex problems.(Shen, S., Jiang, H. and Zhang, T., 2012. Stock market forecasting using machine learning algorithms. Department of Electrical Engineering, Stanford University, Stanford, CA, pp.1-5.) We evaluate Northrop Grumman Corporation Common Stock prediction models with Modular Neural Network (Market Volatility Analysis) and ElasticNet Regression1,2,3,4 and conclude that the NOC stock is predictable in the short/long term. According to price forecasts for (n+3 month) period: The dominant strategy among neural network is to Buy NOC stock.

Key Points

  1. How can neural networks improve predictions?
  2. Understanding Buy, Sell, and Hold Ratings
  3. How do you pick a stock?

NOC Target Price Prediction Modeling Methodology

We consider Northrop Grumman Corporation Common Stock Decision Process with Modular Neural Network (Market Volatility Analysis) where A is the set of discrete actions of NOC stock holders, F is the set of discrete states, P : S × F × S → R is the transition probability distribution, R : S × F → R is the reaction function, and γ ∈ [0, 1] is a move factor for expectation.1,2,3,4


F(ElasticNet Regression)5,6,7= p a 1 p a 2 p 1 n p j 1 p j 2 p j n p k 1 p k 2 p k n p n 1 p n 2 p n n X R(Modular Neural Network (Market Volatility Analysis)) X S(n):→ (n+3 month) r s rs

n:Time series to forecast

p:Price signals of NOC stock

j:Nash equilibria (Neural Network)

k:Dominated move

a:Best response for target price

 

For further technical information as per how our model work we invite you to visit the article below: 

How do AC Investment Research machine learning (predictive) algorithms actually work?

NOC Stock Forecast (Buy or Sell) for (n+3 month)

Sample Set: Neural Network
Stock/Index: NOC Northrop Grumman Corporation Common Stock
Time series to forecast n: 05 Dec 2022 for (n+3 month)

According to price forecasts for (n+3 month) period: The dominant strategy among neural network is to Buy NOC stock.

X axis: *Likelihood% (The higher the percentage value, the more likely the event will occur.)

Y axis: *Potential Impact% (The higher the percentage value, the more likely the price will deviate.)

Z axis (Yellow to Green): *Technical Analysis%

Adjusted IFRS* Prediction Methods for Northrop Grumman Corporation Common Stock

  1. If such a mismatch would be created or enlarged, the entity is required to present all changes in fair value (including the effects of changes in the credit risk of the liability) in profit or loss. If such a mismatch would not be created or enlarged, the entity is required to present the effects of changes in the liability's credit risk in other comprehensive income.
  2. Fluctuation around a constant hedge ratio (and hence the related hedge ineffectiveness) cannot be reduced by adjusting the hedge ratio in response to each particular outcome. Hence, in such circumstances, the change in the extent of offset is a matter of measuring and recognising hedge ineffectiveness but does not require rebalancing.
  3. Changes in market conditions that give rise to market risk include changes in a benchmark interest rate, the price of another entity's financial instrument, a commodity price, a foreign exchange rate or an index of prices or rates.
  4. When rebalancing a hedging relationship, an entity shall update its analysis of the sources of hedge ineffectiveness that are expected to affect the hedging relationship during its (remaining) term (see paragraph B6.4.2). The documentation of the hedging relationship shall be updated accordingly.

*International Financial Reporting Standards (IFRS) are a set of accounting rules for the financial statements of public companies that are intended to make them consistent, transparent, and easily comparable around the world.

Conclusions

Northrop Grumman Corporation Common Stock assigned short-term B1 & long-term Baa2 forecasted stock rating. We evaluate the prediction models Modular Neural Network (Market Volatility Analysis) with ElasticNet Regression1,2,3,4 and conclude that the NOC stock is predictable in the short/long term. According to price forecasts for (n+3 month) period: The dominant strategy among neural network is to Buy NOC stock.

Financial State Forecast for NOC Northrop Grumman Corporation Common Stock Options & Futures

Rating Short-Term Long-Term Senior
Outlook*B1Baa2
Operational Risk 8387
Market Risk6581
Technical Analysis4781
Fundamental Analysis5478
Risk Unsystematic5580

Prediction Confidence Score

Trust metric by Neural Network: 92 out of 100 with 807 signals.

References

  1. N. B ̈auerle and J. Ott. Markov decision processes with average-value-at-risk criteria. Mathematical Methods of Operations Research, 74(3):361–379, 2011
  2. Banerjee, A., J. J. Dolado, J. W. Galbraith, D. F. Hendry (1993), Co-integration, Error-correction, and the Econometric Analysis of Non-stationary Data. Oxford: Oxford University Press.
  3. Swaminathan A, Joachims T. 2015. Batch learning from logged bandit feedback through counterfactual risk minimization. J. Mach. Learn. Res. 16:1731–55
  4. Pennington J, Socher R, Manning CD. 2014. GloVe: global vectors for word representation. In Proceedings of the 2014 Conference on Empirical Methods on Natural Language Processing, pp. 1532–43. New York: Assoc. Comput. Linguist.
  5. Ashley, R. (1988), "On the relative worth of recent macroeconomic forecasts," International Journal of Forecasting, 4, 363–376.
  6. M. Sobel. The variance of discounted Markov decision processes. Applied Probability, pages 794–802, 1982
  7. Çetinkaya, A., Zhang, Y.Z., Hao, Y.M. and Ma, X.Y., Can neural networks predict stock market?(ATVI Stock Forecast). AC Investment Research Journal, 101(3).
Frequently Asked QuestionsQ: What is the prediction methodology for NOC stock?
A: NOC stock prediction methodology: We evaluate the prediction models Modular Neural Network (Market Volatility Analysis) and ElasticNet Regression
Q: Is NOC stock a buy or sell?
A: The dominant strategy among neural network is to Buy NOC Stock.
Q: Is Northrop Grumman Corporation Common Stock stock a good investment?
A: The consensus rating for Northrop Grumman Corporation Common Stock is Buy and assigned short-term B1 & long-term Baa2 forecasted stock rating.
Q: What is the consensus rating of NOC stock?
A: The consensus rating for NOC is Buy.
Q: What is the prediction period for NOC stock?
A: The prediction period for NOC is (n+3 month)

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