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General Dynamics Corporation (GD), with a market cap of $80.6 billion, is a global aerospace and defense company that offers a wide range of products and services in business aviation, ship construction and repair, land combat vehicles, weapons systems, munitions, and technology products and services. Based in Reston, Virginia, the company operates through four segments: Aerospace, Marine Systems, Combat Systems, and Technologies.
Companies valued at $10 billion or more are generally considered “large-cap” stocks, and General Dynamics fits this criterion perfectly, exceeding the mark. General Dynamics has a diverse portfolio of products and services, strong customer relationships with government agencies, and technological expertise through heavy investment in research and development, giving it a competitive edge and enabling the company to deliver innovative solutions.
The aerospace and defense giant has slipped almost 2.8% from its 52-week high of $302.42, achieved on June 3. Shares of General Dynamics are up 6.8% over the past three months, slightly underperforming the broader S&P 500 Index's ($SPX) 7% gains over the same time frame.
Longer term, GD is up 13.2% on a YTD basis, slightly trailing SPX's 14.8% gains. However, shares of General Dynamics have surged 35.2% over the past 52 weeks, outperforming SPX's 24.1% returns over the same time frame.
To confirm the bullish price trend, GD has been consistently trading above its 100-day and 200-day moving averages since early October last year.
Shares of General Dynamics are soaring this year due to heightened global geopolitical tensions and increased defense spending in various countries. However, on April 24, General Dynamics stock took a hit with a 4% drop following its Q1 earnings results. The company missed its earnings expectations for the quarter, reporting EPS of $2.88 compared to consensus estimates of $2.89. The delay in the certification of the Gulfstream G700 business jet impacted the earnings.
Nevertheless, General Dynamics’ rival Northrop Grumman Corporation (NOC) is underperforming – not just GD but the broader equity benchmark. Shares of Northrop Grumman have declined 6.2% over the past 52 weeks and are down 8.2% on a YTD basis.
In sync with the stock’s upward price action, analysts are optimistic about GD’s prospects. The stock has a consensus rating of “Strong Buy” from the 19 analysts in coverage, and the mean price target of $314.29 is a 7% premium to current price levels.
On the date of publication, Kritika Sarmah did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
