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General Dynamics
(NYSE:GD)
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Rating:82Outperform
Price Target:
$455.00
▲(17.65% Upside)
Action:Reiterated
Date:08/09/26
GD scores well overall on strong financial performance (steady growth, improving leverage, and robust TTM free cash flow) and a very constructive earnings update (raised EPS guidance alongside record backlog and strong cash conversion). Technicals also support the score with a clear uptrend. The main offset is valuation, with a 23.06 P/E and only a moderate 1.61% dividend yield, plus near-term margin and second-half cash headwinds noted on the call.
Positive Factors
Exceptional free cash flow generation
Consistently strong free cash flow and high cash conversion provide durable financial flexibility. Over multi-year defense programs this funds capex, sustainment investments, dividends and buybacks, and supports deleveraging or opportunistic M&A without relying on volatile external funding sources.
Negative Factors
Margin pressure in parts of the business
Sustained margin compression in specific segments can erode corporate profitability and free cash over time. For a company with large fixed-cost programs, weaker margins may reflect cost inflation, mix shifts, or pricing pressure on services, reducing ability to fund reinvestment and maintain long-run return targets.
Read all positive and negative factors
Positive Factors
Negative Factors
Exceptional free cash flow generation
Consistently strong free cash flow and high cash conversion provide durable financial flexibility. Over multi-year defense programs this funds capex, sustainment investments, dividends and buybacks, and supports deleveraging or opportunistic M&A without relying on volatile external funding sources.
Read all positive factors
General Dynamics Key Performance Indicators (KPIs)
Any
Revenue by Segment
Breaks down sales across different business units, revealing which areas contribute most to the company's top line and indicating growth opportunities or potential vulnerabilities.
Breaks down sales across different business units, revealing which areas contribute most to the company's top line and indicating growth opportunities or potential vulnerabilities.
Data provided by:
The Fly
The FlyGeneral Dynamics (GD) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$107.08B
Dividend Yield1.58%
Average Volume (3M)1.24M
Price to Earnings (P/E)23.5
Beta (1Y)0.57
Revenue Growth9.13%
EPS Growth10.37%
CountryUS
Employees117,000
SectorIndustrials
Sector Strength72
IndustryAerospace & Defense
Share Statistics
EPS (TTM)16.63
Shares Outstanding270,557,200
10 Day Avg. Volume1,143,274
30 Day Avg. Volume1,241,697
Financial Highlights & Ratios
PEG Ratio1.62
Price to Book (P/B)3.55
Price to Sales (P/S)1.73
P/FCF Ratio22.95
Enterprise Value/Market Cap<0.01
Enterprise Value/Revenue<0.01
Enterprise Value/Gross Profit<0.01
Enterprise Value/Ebitda<0.01
Forecast
1Y Price Target
$423.92Price Target Upside9.61% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering16
EPS Forecast (FY)16.95
Revenue Forecast (FY)$55.87B
General Dynamics Business Overview & Revenue Model
Company Description
General Dynamics Corporation is a global leader in the aerospace and defense industry, with its operations structured across four key divisions: Aerospace, Marine Systems, Combat Systems, and Technologies. The Aerospace segment focuses on the desi...
How the Company Makes Money
General Dynamics primarily makes money by selling high-value defense platforms and delivering long-term services under contracts—predominantly with the U.S. government (especially the Department of Defense)—and by manufacturing and servicing Gulfs...
General Dynamics Earnings Call Summary
Earnings Call Date:Jul 29, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Oct 28, 2026
Earnings Call Sentiment Positive
The call highlighted broad-based strength: robust revenue and earnings growth, record backlog (+32% YoY), strong order intake (book-to-bill >1 in all segments), exceptional cash generation and an increased full-year EPS outlook. Challenges include margin pressure in some businesses, increased planned capex and a sizeable pension contribution that will temper second-half cash flow, lingering single-source supply risks, and external budget/procurement timing uncertainty. On balance the positives—especially the backlog, cash conversion and raised guidance—substantially outweigh the negatives.Positive Updates
Strong Quarterly Financial Results
Q2 revenue of $14.1B; operating earnings $1.460B; net earnings $1.160B; diluted EPS $4.24. Year-over-year revenue +8.1%, operating earnings +~12%, net earnings +14.4%, EPS +13.4% ($0.50). Company operating margin 10.4%, up 40 bps YoY.
Negative Updates
Margin Pressure in Parts of the Business
Combat Systems operating earnings down $6M and margin down 30 bps YoY to 13.9%. Technologies operating margin decreased 20 bps to 9.4%. Aerospace Q3 margin expected similar to Q2 due to mix and higher G&A/R&D with Q4 improvement expected.
Read all updates
Q2-2026 Updates
Positive
Negative
Strong Quarterly Financial Results
Q2 revenue of $14.1B; operating earnings $1.460B; net earnings $1.160B; diluted EPS $4.24. Year-over-year revenue +8.1%, operating earnings +~12%, net earnings +14.4%, EPS +13.4% ($0.50). Company operating margin 10.4%, up 40 bps YoY.
Read all positive updates
Company Guidance
Guidance: For full‑year 2026 General Dynamics now expects company revenue of about $55.7 billion, an operating margin of 10.5% and raised EPS to $16.80–$16.90; by segment the company forecasts Aerospace revenue ≈ $13.8B (≈160 Gulfstream deliveries) with a 14.7% margin (Q3 ~in line with Q2, stronger Q4), Combat revenue ≈ $9.8B with a 13.8% margin, Marine Systems revenue ≈ $18.0B with a 7.4% margin, and Technologies revenue ≈ $14.1B with a 9.4% margin. Capital and cash guidance includes full‑year capex of 3.5–4.0% of sales (Q2 capex $234M; H1 $437M) with capex weighted to H2, an expected free‑cash‑flow conversion of ~105% of net income (Q2 FCF $1.6B, H1 FCF $3.6B; Q2 cash conversion 142%, H1 >150%), a planned ~$500M pension contribution, >$500M of cash taxes weighted to H2, net interest expense of ~ $270M for the year, and a full‑year effective tax rate around 17.5% (H1 17.7%). Orders/backlog and liquidity: Q2 orders were just shy of $20B producing a company book‑to‑bill of 1.4x (Aerospace 1.5x; Combat Systems 2.1x), record backlog $136.5B (up 32% YoY) and total estimated contract value $186.9B; Q2 cash ≈ $4.3B and net debt ≈ $3.2B. Dividends in Q2 were ≈ $430M and share repurchases ≈ $100M.General Dynamics Financial Statement Overview
Summary
Income Statement
84
Very Positive
Balance Sheet
82
Very Positive
Cash Flow
87
Very Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 54.86B | 52.55B | 47.72B | 42.27B | 39.41B | 38.47B |
| Gross Profit | 8.44B | 7.95B | 7.36B | 6.67B | 6.62B | 6.41B |
| EBITDA | 6.45B | 6.10B | 5.82B | 5.25B | 5.31B | 5.19B |
| Net Income | 4.49B | 4.21B | 3.78B | 3.31B | 3.39B | 3.26B |
Balance Sheet | ||||||
| Total Assets | 60.16B | 57.25B | 55.88B | 54.81B | 51.59B | 50.07B |
| Cash, Cash Equivalents and Short-Term Investments | 4.33B | 2.33B | 1.70B | 1.91B | 1.24B | 1.60B |
| Total Debt | 9.48B | 9.79B | 10.68B | 11.08B | 12.11B | 13.18B |
| Total Liabilities | 33.34B | 31.63B | 33.82B | 33.51B | 33.02B | 32.43B |
| Stockholders Equity | 26.83B | 25.62B | 22.06B | 21.30B | 18.57B | 17.64B |
Cash Flow | ||||||
| Free Cash Flow | 6.45B | 3.96B | 3.20B | 3.81B | 3.46B | 3.38B |
| Operating Cash Flow | 7.71B | 5.12B | 4.11B | 4.71B | 4.58B | 4.27B |
| Investing Cash Flow | -1.49B | -1.29B | -959.00M | -945.00M | -1.49B | -882.00M |
| Financing Cash Flow | -3.39B | -3.19B | -3.37B | -3.09B | -3.47B | -4.59B |
General Dynamics Technical Analysis
Positive
386.75
Price Trends
369.86
Positive
354.14
Positive
349.70
Positive
Market Momentum
6.90
Positive
59.42
Neutral
76.97
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GD, the sentiment is Positive. The current price of 386.75 is above the 20-day moving average (MA) of 386.58, above the 50-day MA of 369.86, and above the 200-day MA of 349.70, indicating a bullish trend. The MACD of 6.90 indicates Positive momentum. The RSI at 59.42 is Neutral, neither overbought nor oversold. The STOCH value of 76.97 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for GD.
General Dynamics Risk Analysis
General Dynamics disclosed 14 risk factors in its most recent earnings report. General Dynamics reported the most risks in the "Production" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
General Dynamics Peers Comparison
UnderperformOutperform
Sector (63)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
82 Outperform | $107.08B | 23.52 | 17.43% | 1.60% | 9.13% | 10.37% | |
76 Outperform | $140.48B | 21.79 | 86.24% | 2.34% | 7.20% | 52.79% | |
76 Outperform | $300.51B | 38.55 | 11.79% | 1.30% | 11.84% | 24.93% | |
70 Outperform | $83.23B | 18.08 | 26.58% | 1.73% | 5.90% | 16.00% | |
69 Neutral | $54.34B | 27.95 | 9.41% | 1.63% | 7.29% | 10.75% | |
63 Neutral | $10.79B | 15.43 | 7.44% | 2.01% | 2.89% | -14.66% | |
49 Neutral | $183.11B | 84.63 | 104.83% | ― | 24.78% | ― |
* Industrials Sector Average
GD
General Dynamics
391.14
83.00
26.93%
BA
Boeing
225.95
-6.46
-2.78%
LHX
L3Harris Technologies
278.38
10.80
4.04%
LMT
Lockheed Martin
593.74
164.67
38.38%
NOC
Northrop Grumman
570.20
-5.59
-0.97%
RTX
RTX
221.64
68.41
44.65%
General Dynamics Corporate Events
Executive/Board Changes
General Dynamics Elects President Danny Deep to Board
Positive
Aug 7, 2026
On August 5, 2026, General Dynamics’ board of directors elected company president Danny Deep, 56, to its board, effective immediately, formalizing the elevation of a long-serving internal executive to the governance level. Deep, who has been...
Regulatory Filings and Compliance
General Dynamics Files Prospectus for Share Rescission Offer
Neutral
Aug 4, 2026
On August 4, 2026, General Dynamics filed a prospectus supplement with the SEC under its automatic shelf registration to support a rescission offer covering up to 1,010,925 shares of its common stock. This filing is part of a formal process to val...
Executive/Board ChangesShareholder Meetings
General Dynamics Shareholders Reaffirm Board and Governance Direction
Positive
May 11, 2026
At General Dynamics’ annual meeting of shareholders held on May 6, 2026, investors elected all nominated directors in an uncontested vote, reaffirming the current board’s composition and leadership. The slate included Chair and CEO Phe...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.