General Dynamics Corp (GD) stock analysis

P/E above its 5-year median

General Dynamics's P/E of 21.6 is above its own 5-year median of 20.7.

P/E above the industry

General Dynamics's P/E of 21.6 is above the Transportation Equipment median of 20.3.

EV/EBITDA below its 5-year median

General Dynamics's EV/EBITDA of 15.0 is below its 5-year median of 16.8.

P/B above the industry

General Dynamics's price-to-book of 3.64 is above the Transportation Equipment median of 1.86.

Trading above fair value

The share price of $367.22 is above our fair value estimate of $320.93.

Margin of safety under 20%

The price is 14.4% above fair value, so there is no margin of safety.

Revenue growing 10%+ a year

Revenue grew 10.1% a year over the last three fiscal years.

EPS growing under 10% a year

Diluted EPS grew 8.2% a year over the last three fiscal years.

Earnings growth accelerating

Net income grew 10.5% over the last twelve months, against a 5-year average of 5.9% a year.

Growing faster than the industry

Revenue grew 9.7% over the last twelve months; the Transportation Equipment median is 9.5%.

Company guidance

No outlook found in earnings releases from the last twelve months.

Gross margin trend

This company does not report gross profit.

Return on equity over 15%

Return on equity was 18.0% over the last twelve months and averaged 18.0% over five years.

Return on capital over 10%

Return on invested capital was 16.1%, above the 10% that usually covers the cost of capital.

Return on equity above the industry

General Dynamics's return on equity of 18.0% is above the Transportation Equipment median of 2.7%.

Earnings grew over 5 years

Net income grew 5.9% a year on average over the last five fiscal years.

Net margin above its 5-year average

Net margin was 8.2% over the last twelve months, against a 5-year average of 8.2%.

Net margin above the industry

General Dynamics's net margin of 8.2% is above the Transportation Equipment median of 1.9%.

Low debt

Debt is 25.7% of shareholders' equity, under the 40% we consider low.

Debt falling against equity

Debt to equity fell from 83.0% five years ago to 25.7%.

Debt covered by cash flow

Operating cash flow over the last twelve months equals 104% of total debt.

Interest coverage

Interest expense is not reported separately.

Short-term assets cover short-term debts

Current assets are 1.43 times current liabilities.

Low bankruptcy risk

The Altman Z-score is 4.31; above 3 is the safe zone and below 1.8 the distress zone.

Pays a dividend

General Dynamics paid dividends worth 1.7% of the share price over the last twelve months.

Yield below Treasuries

The 1.7% yield is below the 4.4% on a 1-year Treasury.

Yield below the top quarter

The top quarter of US dividend payers yield 3.8% or more; General Dynamics yields 1.7%.

Dividend stability

Fewer than five years of dividend history.

Covered by earnings

Dividends take 35.8% of net income.

Covered by free cash flow

Dividends take 28.9% of free cash flow.