Last week, Northrop Grumman (NYSE:NOC) announced a plan to buy back $5 billion worth of shares, hoping to retire 25% of its share count over the next two-and-a-half years. But why is Northrop buying back stock?

And should it be?

And can it afford to?

And can it afford not to?

Listen in as Fool contributor Rich Smith lays out the answers to these and other questions you may not even have thought of yet.

Fool contributor Rich Smith has no position in any stocks mentioned. The Motley Fool owns shares of General Dynamics, Lockheed Martin, and Northrop Grumman. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.