Back to top

Analyst Blog

General Dynamics Corporation (GD - Analyst Report) won a $9.5 million contract through its business wing, General Dynamics Electric Boat.

This is an agreement modification received from the U.S. Navy to plan and perform maintenance and modernization work on its Los Angeles-class attack submarine, the USS Hartford (SSN-768).

The latest deal calls for Electric Boat to carry out a dry-docking selected restricted availability at the company's Groton shipyard. The operation will likely be finished by September and generate over 400 jobs at its peak level. The contract was originally awarded in April last year with a potential value of $67 million.

Based in Falls Church, Va., General Dynamics engages in mission-critical information systems and technologies; land and expeditionary combat vehicles, armaments and munitions; shipbuilding and marine systems; and business aviation.

Over the years, General Dynamics has a long-standing business association with the U.S. Navy. The company’s order backlog at the end of fourth-quarter 2012 was a healthy $17.1 billion. Its diversified business operations also help to keep the growth rate stable.

As the U.S. Department of Defense is one of the key customers of General Dynamics, any further U.S. defense budget cutback could limit the company’s future growth prospects. We believe this is one of the main reasons for the drop in Marine Systems Group’s total backlog by 7.6% year over year to $17.1 billion in fourth-quarter 2012. Hence, uncertainty related to defense budgets and the U.S. debt situation remains an overhang for the company.

Presently, General Dynamics carries a Zacks Rank #4 (Sell). Other stocks worth considering are Zacks Ranked #2 (Buy) Wesco Aircraft Holdings, Inc. (WAIR - Snapshot Report), FLIR Systems, Inc. (FLIR - Analyst Report) and Triumph Group, Inc. (TGI - Analyst Report).

Please login to Zacks.com or register to post a comment.

New to Zacks?

Start Here

Zacks Investment Research

Close

Are you a new Zacks Member or a visitor to Zacks.com?

Top Zacks Features

My Portfolio Tracker

Is it Time to Sell?

One of the most important steps you can take today is to set up your portfolio tracker on Zacks.com. Once you do, you'll be notified of major events affecting your stocks and/or funds with daily email alerts.

More Zacks Resources

Zacks Rank Home - Evaluate your stocks and use the Zacks Rank to eliminate the losers and keep the winners.

Mutual Fund Rank Home - Evaluate your funds with the Mutual Fund Rank for both your personal and retirement funds.

Stock/Mutual Fund Screening - Find better stocks and mutual funds. The ones most likely to beat the market and provide a positive return.

My Portfolio - Track your Portfolio and find out where your stocks/mutual funds stack up with the Zacks Rank.

Zacks #1 Rank Top Movers for Zacks #1 Rank Top Movers

Company Symbol Price %Chg
RPC INC RES 24.91 +8.35%
LITHIA MOTO… LAD 94.59 +4.60%
DELTA AIR L… DAL 39.15 +3.90%
FLAMEL TECH… FLML 14.51 +3.50%
SOUTHWEST A… LUV 28.87 +2.92%