In the latest close session, General Dynamics (GD) was down 1.17% at $337.49. This change lagged the S&P 500's 1.07% loss on the day. Elsewhere, the Dow lost 0.51%, while the tech-heavy Nasdaq lost 1.69%.
The defense contractor's stock has dropped by 0.75% in the past month, falling short of the Aerospace sector's loss of 0.27% and the S&P 500's gain of 0.94%.
Analysts and investors alike will be keeping a close eye on the performance of General Dynamics in its upcoming earnings disclosure. The company's earnings per share (EPS) are projected to be $4.11, reflecting a 0.96% decrease from the same quarter last year. At the same time, our most recent consensus estimate is projecting a revenue of $13.72 billion, reflecting a 2.88% rise from the equivalent quarter last year.
GD's full-year Zacks Consensus Estimates are calling for earnings of $15.37 per share and revenue of $51.97 billion. These results would represent year-over-year changes of +12.77% and +8.92%, respectively.
It is also important to note the recent changes to analyst estimates for General Dynamics. These revisions typically reflect the latest short-term business trends, which can change frequently. As such, positive estimate revisions reflect analyst optimism about the business and profitability.
Our research suggests that these changes in estimates have a direct relationship with upcoming stock price performance. To utilize this, we have created the Zacks Rank, a proprietary model that integrates these estimate changes and provides a functional rating system.
The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Over the past month, there's been a 0.05% fall in the Zacks Consensus EPS estimate. Currently, General Dynamics is carrying a Zacks Rank of #3 (Hold).
Looking at valuation, General Dynamics is presently trading at a Forward P/E ratio of 22.22. This denotes a discount relative to the industry average Forward P/E of 27.21.
We can also see that GD currently has a PEG ratio of 1.73. The PEG ratio bears resemblance to the frequently used P/E ratio, but this parameter also includes the company's expected earnings growth trajectory. GD's industry had an average PEG ratio of 2.03 as of yesterday's close.
The Aerospace - Defense industry is part of the Aerospace sector. This industry, currently bearing a Zacks Industry Rank of 88, finds itself in the top 36% echelons of all 250+ industries.
The Zacks Industry Rank assesses the strength of our separate industry groups by calculating the average Zacks Rank of the individual stocks contained within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Don't forget to use Zacks.com to keep track of all these stock-moving metrics, and others, in the upcoming trading sessions.
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General Dynamics Corporation (GD): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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