Reviewing General Dynamics (GD) & The Competition

General Dynamics (NYSE:GD) is one of 229 publicly-traded companies in the “Aerospace & Defense” industry, but how does it compare to its competitors? We will compare General Dynamics to similar businesses based on the strength of its valuation, institutional ownership, analyst recommendations, earnings, profitability, dividends and risk.

Valuation and Earnings

This table compares General Dynamics and its competitors top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
General Dynamics	$52.55 billion	$4.21 billion	20.82
General Dynamics Competitors	$8.33 billion	$569.54 million	23.70

General Dynamics has higher revenue and earnings than its competitors. General Dynamics is trading at a lower price-to-earnings ratio than its competitors, indicating that it is currently more affordable than other companies in its industry.

Insider and Institutional Ownership

86.1% of General Dynamics shares are owned by institutional investors. Comparatively, 49.5% of shares of all “Aerospace & Defense” companies are owned by institutional investors. 1.4% of General Dynamics shares are owned by company insiders. Comparatively, 11.9% of shares of all “Aerospace & Defense” companies are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Dividends

General Dynamics pays an annual dividend of $6.36 per share and has a dividend yield of 1.8%. General Dynamics pays out 37.4% of its earnings in the form of a dividend. As a group, “Aerospace & Defense” companies pay a dividend yield of 1.1% and pay out 38.5% of their earnings in the form of a dividend. General Dynamics has increased its dividend for 34 consecutive years. General Dynamics is clearly a better dividend stock than its competitors, given its higher yield and lower payout ratio.

Analyst Recommendations

This is a breakdown of current ratings and target prices for General Dynamics and its competitors, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
General Dynamics	1	5	11	0	2.59
General Dynamics Competitors	2156	8256	12756	579	2.50

General Dynamics currently has a consensus price target of $408.94, suggesting a potential upside of 15.56%. As a group, “Aerospace & Defense” companies have a potential upside of 32.92%. Given General Dynamics’ competitors higher possible upside, analysts clearly believe General Dynamics has less favorable growth aspects than its competitors.

Profitability

This table compares General Dynamics and its competitors’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
General Dynamics	8.24%	17.60%	7.87%
General Dynamics Competitors	-286.73%	-47.03%	-4.24%

Risk and Volatility

General Dynamics has a beta of 0.3, suggesting that its share price is 70% less volatile than the S&P 500. Comparatively, General Dynamics’ competitors have a beta of 1.31, suggesting that their average share price is 31% more volatile than the S&P 500.

Summary

General Dynamics beats its competitors on 10 of the 15 factors compared.

General Dynamics Company Profile

General Dynamics Corporation operates as an aerospace and defense company worldwide. It operates through four segments: Aerospace, Marine Systems, Combat Systems, and Technologies. The Aerospace segment produces and sells business jets; and offers aircraft maintenance and repair, management, aircraft-on-ground support and completion, charter, staffing, and fixed-base operator services. The Marine Systems segment designs and builds nuclear-powered submarines, surface combatants, and auxiliary ships for the United States Navy and Jones Act ships for commercial customers, as well as builds crude oil and product tankers, and container and cargo ships; provides maintenance, modernization, and lifecycle support services for navy ships; offers and program management, planning, engineering, and design support services for submarine construction programs. The Combat Systems segment manufactures land combat solutions, such as wheeled and tracked combat vehicles, Stryker wheeled combat vehicles, piranha vehicles, weapons systems, munitions, mobile bridge systems with payloads, tactical vehicles, main battle tanks, armored vehicles, and armaments; and offers modernization programs, engineering, support, and sustainment services. The Technologies segment provides information technology solutions and mission support services; mobile communication, computers, and command-and-control mission systems; intelligence, surveillance, and reconnaissance solutions to military, intelligence, and federal civilian customers; cloud computing, artificial intelligence; machine learning; big data analytics; development, security, and operations; and unmanned undersea vehicle manufacturing and assembly services. The company was founded in 1899 and is headquartered in Reston, Virginia.