On Thursday, RBC Capital Markets adjusted its outlook on General Dynamics Corp. (NYSE: NYSE:GD), reducing the price target to $320 from $325 while maintaining an Outperform rating.
The aerospace and defense company reported first-quarter 2024 revenues of $10.7 billion, marking an 8.6% increase from the previous year. This growth was attributed to significant advances in the Combat Systems, Marine Systems, and Aerospace sectors.
General Dynamics' adjusted earnings per share (EPS) reached $2.88, but the results were impacted by the timing of the G700 certification and the absence of aircraft deliveries in the first quarter. RBC Capital's analysis pointed out that these factors likely caused a deviation from the consensus expectations for the quarter.
The company issued cautious statements regarding its earnings and free cash flow (FCF) for the second quarter of 2024. Despite this, RBC Capital expressed a positive outlook for the latter half of the year. The firm anticipates a strong setup for General Dynamics heading into the second half of 2024.
RBC Capital highlighted capital allocation as a potential key driver for General Dynamics' performance moving forward. The firm's continued confidence in the company's prospects is reflected in the maintained Outperform rating, despite the slight adjustment in the price target to $320.
InvestingPro Insights
General Dynamics Corp. (NYSE: GD) has demonstrated a commitment to shareholder returns, as evidenced by its track record of raising dividends for 10 consecutive years, with a current dividend yield of 2.02%. This commitment is further solidified by the company's history of maintaining dividend payments for 46 consecutive years. With a market capitalization of $76.83 billion and a P/E ratio (adjusted for the last twelve months as of Q1 2024) of 22.76, General Dynamics stands as a prominent player in the Aerospace & Defense industry. The company's stock is also known for its low price volatility, which may appeal to investors seeking stability.
InvestingPro Tips highlight that General Dynamics operates with a moderate level of debt and maintains a financial position where liquid assets exceed short term obligations. Analysts predict the company will be profitable this year, a prediction supported by the company's profitability over the last twelve months. For investors interested in further insights and metrics, there are additional InvestingPro Tips available at: https://www.investing.com/pro/GD. Use coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription, and discover 5 more InvestingPro Tips that could guide your investment decisions with General Dynamics.
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