GENERAL DYNAMICS CORP (GD) Stock Fundamental Analysis
NYSE:GD - New York Stock Exchange, Inc. - US3695501086 - Common Stock - Currency: USD
Overall GD gets a fundamental rating of 6 out of 10. We evaluated GD against 65 industry peers in the Aerospace & Defense industry. GD has only an average score on both its financial health and profitability. GD has a decent growth rate and is not valued too expensively.
1. Profitability
1.1 Basic Checks
In the past year GD was profitable.
GD had a positive operating cash flow in the past year.
In the past 5 years GD has always been profitable.
In the past 5 years GD always reported a positive cash flow from operatings.
1.2 Ratios
GD has a better Return On Assets (7.03%) than 75.38% of its industry peers.
GD has a better Return On Equity (17.89%) than 86.15% of its industry peers.
With an excellent Return On Invested Capital value of 11.07%, GD belongs to the best of the industry, outperforming 87.69% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for GD is in line with the industry average of 8.44%.
The last Return On Invested Capital (11.07%) for GD is above the 3 year average (9.79%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.03% | ||
| ROE | 17.89% | ||
| ROIC | 11.07% |
ROA(3y)6.46%
ROA(5y)6.41%
ROE(3y)16.99%
ROE(5y)17.93%
ROIC(3y)9.79%
ROIC(5y)9.74%
1.3 Margins
Looking at the Profit Margin, with a value of 8.08%, GD is in the better half of the industry, outperforming 73.85% of the companies in the same industry.
In the last couple of years the Profit Margin of GD has declined.
The Operating Margin of GD (10.22%) is better than 69.23% of its industry peers.
In the last couple of years the Operating Margin of GD has declined.
GD has a Gross Margin of 15.43%. This is in the lower half of the industry: GD underperforms 75.38% of its industry peers.
In the last couple of years the Gross Margin of GD has declined.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 10.22% | ||
| PM (TTM) | 8.08% | ||
| GM | 15.43% |
OM growth 3Y-2.43%
OM growth 5Y-3.18%
PM growth 3Y-2.17%
PM growth 5Y-2.19%
GM growth 3Y-2.51%
GM growth 5Y-2.96%
2. Health
2.1 Basic Checks
GD has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it is creating some value.
The number of shares outstanding for GD has been reduced compared to 1 year ago.
GD has less shares outstanding than it did 5 years ago.
Compared to 1 year ago, GD has an improved debt to assets ratio.
2.2 Solvency
GD has an Altman-Z score of 3.72. This indicates that GD is financially healthy and has little risk of bankruptcy at the moment.
GD has a Altman-Z score (3.72) which is comparable to the rest of the industry.
The Debt to FCF ratio of GD is 2.88, which is a good value as it means it would take GD, 2.88 years of fcf income to pay off all of its debts.
GD's Debt to FCF ratio of 2.88 is amongst the best of the industry. GD outperforms 90.77% of its industry peers.
A Debt/Equity ratio of 0.33 indicates that GD is not too dependend on debt financing.
With a decent Debt to Equity ratio value of 0.33, GD is doing good in the industry, outperforming 67.69% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.33 | ||
| Debt/FCF | 2.88 | ||
| Altman-Z | 3.72 |
ROIC/WACC1.14
WACC9.68%
2.3 Liquidity
A Current Ratio of 1.34 indicates that GD should not have too much problems paying its short term obligations.
Looking at the Current ratio, with a value of 1.34, GD is doing worse than 69.23% of the companies in the same industry.
GD has a Quick Ratio of 1.34. This is a bad value and indicates that GD is not financially healthy enough and could expect problems in meeting its short term obligations.
Looking at the Quick ratio, with a value of 0.82, GD is doing worse than 76.92% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.34 | ||
| Quick Ratio | 0.82 |
3. Growth
3.1 Past
GD shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 17.62%, which is quite good.
The Earnings Per Share has been growing slightly by 2.63% on average over the past years.
The Revenue has grown by 14.11% in the past year. This is quite good.
GD shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 3.93% yearly.
EPS 1Y (TTM)17.62%
EPS 3Y5.7%
EPS 5Y2.63%
EPS Q2Q%27.08%
Revenue 1Y (TTM)14.11%
Revenue growth 3Y7.44%
Revenue growth 5Y3.93%
Sales Q2Q%13.9%
3.2 Future
GD is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 10.00% yearly.
Based on estimates for the next years, GD will show a small growth in Revenue. The Revenue will grow by 4.42% on average per year.
EPS Next Y12.77%
EPS Next 2Y12.3%
EPS Next 3Y11.02%
EPS Next 5Y10%
Revenue Next Year6.59%
Revenue Next 2Y5.41%
Revenue Next 3Y4.4%
Revenue Next 5Y4.42%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 20.44, which indicates a rather expensive current valuation of GD.
Based on the Price/Earnings ratio, GD is valued cheaply inside the industry as 87.69% of the companies are valued more expensively.
The average S&P500 Price/Earnings ratio is at 27.45. GD is valued slightly cheaper when compared to this.
The Price/Forward Earnings ratio is 17.14, which indicates a rather expensive current valuation of GD.
GD's Price/Forward Earnings ratio is rather cheap when compared to the industry. GD is cheaper than 89.23% of the companies in the same industry.
GD's Price/Forward Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 21.90.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 20.44 | ||
| Fwd PE | 17.14 |
4.2 Price Multiples
GD's Enterprise Value to EBITDA ratio is rather cheap when compared to the industry. GD is cheaper than 86.15% of the companies in the same industry.
Based on the Price/Free Cash Flow ratio, GD is valued cheaper than 90.77% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 23.72 | ||
| EV/EBITDA | 14.76 |
4.3 Compensation for Growth
The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
GD has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)1.6
PEG (5Y)7.77
EPS Next 2Y12.3%
EPS Next 3Y11.02%
5. Dividend
5.1 Amount
GD has a Yearly Dividend Yield of 2.06%. Purely for dividend investing, there may be better candidates out there.
Compared to an average industry Dividend Yield of 1.27, GD pays a better dividend. On top of this GD pays more dividend than 93.85% of the companies listed in the same industry.
GD's Dividend Yield is comparable with the S&P500 average which is at 2.42.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.06% |
5.2 History
On average, the dividend of GD grows each year by 7.16%, which is quite nice.
GD has been paying a dividend for at least 10 years, so it has a reliable track record.
GD has decreased its dividend in the last 3 years.
Dividend Growth(5Y)7.16%
Div Incr Years2
Div Non Decr Years2
5.3 Sustainability
39.00% of the earnings are spent on dividend by GD. This is a low number and sustainable payout ratio.
GD's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP39%
EPS Next 2Y12.3%
EPS Next 3Y11.02%
294.76
+0.84 (+0.29%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryAerospace & Defense
Earnings (Last)
Earnings (Next)
Inst Owners76.5%
Inst Owner Change-1.1%
Ins Owners0.21%
Ins Owner Change1.76%
Market Cap79.11B
Analysts73.33
Price Target299.35 (1.56%)
Short Float %0.93%
Short Ratio2.02
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.06% |
Yearly Dividend5.62
Dividend Growth(5Y)7.16%
DP39%
Div Incr Years2
Div Non Decr Years2
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)0.56%
Min EPS beat(2)-0.53%
Max EPS beat(2)1.66%
EPS beat(4)1
Avg EPS beat(4)-2.1%
Min EPS beat(4)-6.39%
Max EPS beat(4)1.66%
EPS beat(8)3
Avg EPS beat(8)-1.68%
EPS beat(12)4
Avg EPS beat(12)-1.5%
EPS beat(16)6
Avg EPS beat(16)-1.24%
Revenue beat(2)1
Avg Revenue beat(2)0.2%
Min Revenue beat(2)-1%
Max Revenue beat(2)1.41%
Revenue beat(4)2
Avg Revenue beat(4)-0.15%
Min Revenue beat(4)-2.66%
Max Revenue beat(4)1.65%
Revenue beat(8)5
Avg Revenue beat(8)0.79%
Revenue beat(12)6
Avg Revenue beat(12)0.01%
Revenue beat(16)7
Avg Revenue beat(16)-0.9%
PT rev (1m)0.66%
PT rev (3m)1.59%
EPS NQ rev (1m)0.01%
EPS NQ rev (3m)1.81%
EPS NY rev (1m)-0.02%
EPS NY rev (3m)0.58%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)0.42%
Revenue NY rev (1m)-0.07%
Revenue NY rev (3m)0.19%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 20.44 | ||
| Fwd PE | 17.14 | ||
| P/S | 1.61 | ||
| P/FCF | 23.72 | ||
| P/OCF | 18.68 | ||
| P/B | 3.56 | ||
| P/tB | 565.1 | ||
| EV/EBITDA | 14.76 |
EPS(TTM)14.42
EY4.89%
EPS(NY)17.2
Fwd EY5.84%
FCF(TTM)12.43
FCFY4.22%
OCF(TTM)15.78
OCFY5.35%
SpS183.34
BVpS82.81
TBVpS0.52
PEG (NY)1.6
PEG (5Y)7.77
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.03% | ||
| ROE | 17.89% | ||
| ROCE | 13.29% | ||
| ROIC | 11.07% | ||
| ROICexc | 11.44% | ||
| ROICexgc | 28.88% | ||
| OM | 10.22% | ||
| PM (TTM) | 8.08% | ||
| GM | 15.43% | ||
| FCFM | 6.78% |
ROA(3y)6.46%
ROA(5y)6.41%
ROE(3y)16.99%
ROE(5y)17.93%
ROIC(3y)9.79%
ROIC(5y)9.74%
ROICexc(3y)10.23%
ROICexc(5y)10.26%
ROICexgc(3y)26.7%
ROICexgc(5y)28.25%
ROCE(3y)11.76%
ROCE(5y)11.7%
ROICexcg growth 3Y0.05%
ROICexcg growth 5Y-6.95%
ROICexc growth 3Y3.01%
ROICexc growth 5Y-2.13%
OM growth 3Y-2.43%
OM growth 5Y-3.18%
PM growth 3Y-2.17%
PM growth 5Y-2.19%
GM growth 3Y-2.51%
GM growth 5Y-2.96%
F-Score7
Asset Turnover0.87
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.33 | ||
| Debt/FCF | 2.88 | ||
| Debt/EBITDA | 1.23 | ||
| Cap/Depr | 100.11% | ||
| Cap/Sales | 1.83% | ||
| Interest Coverage | 12.54 | ||
| Cash Conversion | 71.46% | ||
| Profit Quality | 83.88% | ||
| Current Ratio | 1.34 | ||
| Quick Ratio | 0.82 | ||
| Altman-Z | 3.72 |
F-Score7
WACC9.68%
ROIC/WACC1.14
Cap/Depr(3y)111.39%
Cap/Depr(5y)108.79%
Cap/Sales(3y)2.3%
Cap/Sales(5y)2.35%
Profit Quality(3y)100.61%
Profit Quality(5y)98.91%
High Growth Momentum
Growth
EPS 1Y (TTM)17.62%
EPS 3Y5.7%
EPS 5Y2.63%
EPS Q2Q%27.08%
EPS Next Y12.77%
EPS Next 2Y12.3%
EPS Next 3Y11.02%
EPS Next 5Y10%
Revenue 1Y (TTM)14.11%
Revenue growth 3Y7.44%
Revenue growth 5Y3.93%
Sales Q2Q%13.9%
Revenue Next Year6.59%
Revenue Next 2Y5.41%
Revenue Next 3Y4.4%
Revenue Next 5Y4.42%
EBIT growth 1Y15.77%
EBIT growth 3Y4.83%
EBIT growth 5Y0.63%
EBIT Next Year27.41%
EBIT Next 3Y12.98%
EBIT Next 5Y10.3%
FCF growth 1Y12.78%
FCF growth 3Y-1.75%
FCF growth 5Y10.42%
OCF growth 1Y3.49%
OCF growth 3Y-1.15%
OCF growth 5Y6.98%