GENERAL DYNAMICS CORP (GD) Stock Fundamental Analysis
NYSE:GD - New York Stock Exchange, Inc. - US3695501086 - Common Stock - Currency: USD
GD gets a fundamental rating of 6 out of 10. The analysis compared the fundamentals against 65 industry peers in the Aerospace & Defense industry. Both the profitability and the financial health of GD get a neutral evaluation. Nothing too spectacular is happening here. GD is not valued too expensively and it also shows a decent growth rate.
1. Profitability
1.1 Basic Checks
GD had positive earnings in the past year.
GD had a positive operating cash flow in the past year.
In the past 5 years GD has always been profitable.
Each year in the past 5 years GD had a positive operating cash flow.
1.2 Ratios
GD has a better Return On Assets (6.77%) than 71.88% of its industry peers.
GD has a better Return On Equity (17.14%) than 85.94% of its industry peers.
With an excellent Return On Invested Capital value of 10.49%, GD belongs to the best of the industry, outperforming 87.50% of the companies in the same industry.
The Average Return On Invested Capital over the past 3 years for GD is in line with the industry average of 7.98%.
The 3 year average ROIC (9.79%) for GD is below the current ROIC(10.49%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 6.77% | ||
| ROE | 17.14% | ||
| ROIC | 10.49% |
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
GD's Profit Margin of 7.93% is fine compared to the rest of the industry. GD outperforms 68.75% of its industry peers.
GD's Profit Margin has declined in the last couple of years.
Looking at the Operating Margin, with a value of 10.05%, GD is in the better half of the industry, outperforming 65.63% of the companies in the same industry.
GD's Operating Margin has declined in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 10.05% | ||
| PM (TTM) | 7.93% | ||
| GM | N/A |
OM growth 3Y-2.43%
OM growth 5Y-3.18%
PM growth 3Y-2.17%
PM growth 5Y-2.19%
GM growth 3YN/A
GM growth 5YN/A
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.
Compared to 1 year ago, GD has less shares outstanding
Compared to 5 years ago, GD has less shares outstanding
The debt/assets ratio for GD has been reduced compared to a year ago.
2.2 Solvency
GD has an Altman-Z score of 3.50. This indicates that GD is financially healthy and has little risk of bankruptcy at the moment.
GD's Altman-Z score of 3.50 is in line compared to the rest of the industry. GD outperforms 54.69% of its industry peers.
The Debt to FCF ratio of GD is 2.75, which is a good value as it means it would take GD, 2.75 years of fcf income to pay off all of its debts.
GD's Debt to FCF ratio of 2.75 is amongst the best of the industry. GD outperforms 87.50% of its industry peers.
A Debt/Equity ratio of 0.33 indicates that GD is not too dependend on debt financing.
Looking at the Debt to Equity ratio, with a value of 0.33, GD is in the better half of the industry, outperforming 67.19% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.33 | ||
| Debt/FCF | 2.75 | ||
| Altman-Z | 3.5 |
ROIC/WACC1.14
WACC9.19%
2.3 Liquidity
A Current Ratio of 1.37 indicates that GD should not have too much problems paying its short term obligations.
Looking at the Current ratio, with a value of 1.37, GD is doing worse than 68.75% of the companies in the same industry.
A Quick Ratio of 0.82 indicates that GD may have some problems paying its short term obligations.
GD's Quick ratio of 0.82 is on the low side compared to the rest of the industry. GD is outperformed by 73.44% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.37 | ||
| Quick Ratio | 0.82 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 13.48% over the past year.
Measured over the past 5 years, GD shows a small growth in Earnings Per Share. The EPS has been growing by 2.63% on average per year.
The Revenue has grown by 12.88% in the past year. This is quite good.
Measured over the past years, GD shows a small growth in Revenue. The Revenue has been growing by 3.93% on average per year.
EPS 1Y (TTM)13.48%
EPS 3Y5.7%
EPS 5Y2.63%
EPS Q2Q%14.01%
Revenue 1Y (TTM)12.88%
Revenue growth 3Y7.44%
Revenue growth 5Y3.93%
Sales Q2Q%14.31%
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 11.17% yearly.
GD is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 4.31% yearly.
EPS Next Y12.13%
EPS Next 2Y12.55%
EPS Next 3Y11.32%
EPS Next 5Y11.17%
Revenue Next Year6.38%
Revenue Next 2Y5.28%
Revenue Next 3Y4.48%
Revenue Next 5Y4.31%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
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
Based on the Price/Earnings ratio of 17.82, the valuation of GD can be described as rather expensive.
Compared to the rest of the industry, the Price/Earnings ratio of GD indicates a rather cheap valuation: GD is cheaper than 85.94% of the companies listed in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 29.63, GD is valued a bit cheaper.
A Price/Forward Earnings ratio of 15.89 indicates a correct valuation of GD.
Based on the Price/Forward Earnings ratio, GD is valued cheaply inside the industry as 87.50% of the companies are valued more expensively.
When comparing the Price/Forward Earnings ratio of GD to the average of the S&P500 Index (22.68), we can say GD is valued slightly cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 17.82 | ||
| Fwd PE | 15.89 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, GD is valued cheaply inside the industry as 82.81% of the companies are valued more expensively.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of GD indicates a rather cheap valuation: GD is cheaper than 95.31% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 20.6 | ||
| EV/EBITDA | 12.96 |
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)1.47
PEG (5Y)6.78
EPS Next 2Y12.55%
EPS Next 3Y11.32%
5. Dividend
5.1 Amount
GD has a Yearly Dividend Yield of 2.31%. Purely for dividend investing, there may be better candidates out there.
GD's Dividend Yield is rather good when compared to the industry average which is at 1.45. GD pays more dividend than 92.19% of the companies in the same industry.
Compared to an average S&P500 Dividend Yield of 2.29, GD has a dividend comparable with the average S&P500 company.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.31% |
5.2 History
The dividend of GD is nicely growing with an annual growth rate of 7.16%!
GD has paid a dividend for at least 10 years, which is 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
GD pays out 40.43% of its income as dividend. This is a bit on the high side, but may be sustainable.
The dividend of GD is growing, but earnings are growing more, so the dividend growth is sustainable.
DP40.43%
EPS Next 2Y12.55%
EPS Next 3Y11.32%
243.06
-3.14 (-1.28%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryAerospace & Defense
Earnings (Last)
Earnings (Next)
Inst Owners86.43%
Inst Owner Change-3.27%
Ins Owners0.25%
Ins Owner Change0.15%
Market Cap65.71B
Analysts76.36
Price Target311.3 (28.08%)
Short Float %1.13%
Short Ratio1.75
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.31% |
Yearly Dividend5.62
Dividend Growth(5Y)7.16%
DP40.43%
Div Incr Years2
Div Non Decr Years2
Ex-Date
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-3.46%
Min EPS beat(2)-6.39%
Max EPS beat(2)-0.53%
EPS beat(4)0
Avg EPS beat(4)-3.68%
Min EPS beat(4)-6.39%
Max EPS beat(4)-0.53%
EPS beat(8)2
Avg EPS beat(8)-2.02%
EPS beat(12)4
Avg EPS beat(12)-1.55%
EPS beat(16)6
Avg EPS beat(16)-1.05%
Revenue beat(2)1
Avg Revenue beat(2)-0.63%
Min Revenue beat(2)-2.66%
Max Revenue beat(2)1.41%
Revenue beat(4)3
Avg Revenue beat(4)0.34%
Min Revenue beat(4)-2.66%
Max Revenue beat(4)1.65%
Revenue beat(8)6
Avg Revenue beat(8)1.27%
Revenue beat(12)7
Avg Revenue beat(12)0.2%
Revenue beat(16)8
Avg Revenue beat(16)-0.67%
PT rev (1m)-4.03%
PT rev (3m)-7.03%
EPS NQ rev (1m)0.38%
EPS NQ rev (3m)-4.6%
EPS NY rev (1m)-7.31%
EPS NY rev (3m)-7.69%
Revenue NQ rev (1m)2.23%
Revenue NQ rev (3m)2.8%
Revenue NY rev (1m)-0.23%
Revenue NY rev (3m)-0.61%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 17.82 | ||
| Fwd PE | 15.89 | ||
| P/S | 1.38 | ||
| P/FCF | 20.6 | ||
| P/OCF | 16 | ||
| P/B | 2.98 | ||
| P/tB | N/A | ||
| EV/EBITDA | 12.96 |
EPS(TTM)13.64
EY5.61%
EPS(NY)15.29
Fwd EY6.29%
FCF(TTM)11.8
FCFY4.85%
OCF(TTM)15.19
OCFY6.25%
SpS176.5
BVpS81.61
TBVpS-0.05
PEG (NY)1.47
PEG (5Y)6.78
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 6.77% | ||
| ROE | 17.14% | ||
| ROCE | 12.6% | ||
| ROIC | 10.49% | ||
| ROICexc | 10.98% | ||
| ROICexgc | 27.96% | ||
| OM | 10.05% | ||
| PM (TTM) | 7.93% | ||
| GM | N/A | ||
| FCFM | 6.69% |
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 3YN/A
GM growth 5YN/A
F-Score8
Asset Turnover0.85
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.33 | ||
| Debt/FCF | 2.75 | ||
| Debt/EBITDA | 1.28 | ||
| Cap/Depr | 103.39% | ||
| Cap/Sales | 1.92% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 72.26% | ||
| Profit Quality | 84.35% | ||
| Current Ratio | 1.37 | ||
| Quick Ratio | 0.82 | ||
| Altman-Z | 3.5 |
F-Score8
WACC9.19%
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)13.48%
EPS 3Y5.7%
EPS 5Y2.63%
EPS Q2Q%14.01%
EPS Next Y12.13%
EPS Next 2Y12.55%
EPS Next 3Y11.32%
EPS Next 5Y11.17%
Revenue 1Y (TTM)12.88%
Revenue growth 3Y7.44%
Revenue growth 5Y3.93%
Sales Q2Q%14.31%
Revenue Next Year6.38%
Revenue Next 2Y5.28%
Revenue Next 3Y4.48%
Revenue Next 5Y4.31%
EBIT growth 1Y12.98%
EBIT growth 3Y4.83%
EBIT growth 5Y0.63%
EBIT Next Year27.75%
EBIT Next 3Y13.11%
EBIT Next 5Y12.33%
FCF growth 1Y-16.1%
FCF growth 3Y-1.75%
FCF growth 5Y10.42%
OCF growth 1Y-12.75%
OCF growth 3Y-1.15%
OCF growth 5Y6.98%