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General Dynamics (GD) Outpaces Stock Market Gains: What You Should Know

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General Dynamics (GD) closed at $216.72 in the latest trading session, marking a +0.95% move from the prior day. This move outpaced the S&P 500's daily gain of 0.59%. Meanwhile, the Dow gained 0.15%, and the Nasdaq, a tech-heavy index, added 0.07%.

Coming into today, shares of the defense contractor had lost 0.86% in the past month. In that same time, the Aerospace sector gained 5.93%, while the S&P 500 gained 7.25%.

Investors will be hoping for strength from General Dynamics as it approaches its next earnings release, which is expected to be July 27, 2022. In that report, analysts expect General Dynamics to post earnings of $2.72 per share. This would mark year-over-year growth of 4.21%. Our most recent consensus estimate is calling for quarterly revenue of $9.39 billion, up 1.82% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $12.12 per share and revenue of $39.5 billion, which would represent changes of +4.94% and +2.68%, respectively, from the prior year.

Investors should also note any recent changes to analyst estimates for General Dynamics. These revisions typically reflect the latest short-term business trends, which can change frequently. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection has moved 0.21% lower. General Dynamics is currently a Zacks Rank #4 (Sell).

Investors should also note General Dynamics's current valuation metrics, including its Forward P/E ratio of 17.71. Its industry sports an average Forward P/E of 17.5, so we one might conclude that General Dynamics is trading at a premium comparatively.

Meanwhile, GD's PEG ratio is currently 1.8. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. The Aerospace - Defense industry currently had an average PEG ratio of 2.02 as of yesterday's close.

The Aerospace - Defense industry is part of the Aerospace sector. This industry currently has a Zacks Industry Rank of 170, which puts it in the bottom 33% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

To follow GD in the coming trading sessions, be sure to utilize Zacks.com.


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