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It has been about a month since the last earnings report for General Dynamics (GD - Free Report) . Shares were flat in that time frame, outperforming the S&P 500.
Will the recent trend continue leading up to its next earnings release, or is General Dynamics due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.
General Dynamics Q1 Earnings Beat, Revenues Up Y/Y
General Dynamics Corporation reported first-quarter 2021 earnings from continuing operations of $2.48 per share, which exceeded the Zacks Consensus Estimate of $2.31 by 7.4%. Moreover, earnings improved 2.1% from $2.43 in the year-ago quarter.
Total Revenues
General Dynamics’ first-quarter revenues of $9,389 million surpassed the Zacks Consensus Estimate of $8,977 million by 4.6%. Further, revenues improved 7.3% from $8,749 million in the year-ago quarter. The decline was primarily attributable to growth in all four segments and growth exceeding 10% in the Aerospace and Marine Systems segments.
Backlog
The company recorded a total backlog of $89.6 billion, up 4.5% year over year. Funded backlog at the quarter-end was $41.8 billion.
Segment Performance
Aerospace: The segment reported revenues of $1,887 million, up 11.6% year over year. Operating earnings of $220 million declined 8.3% from the prior-year quarter’s $240 million.
Combat Systems: Segment revenues improved 6.6% from the prior-year quarter to $1708 million. Moreover, operating earnings were up 9.4% from the year-ago quarter to $244 million.
Technologies: The segment reported revenues of $3,199 million, which increased 3.1% year over year. Operating earnings of $306 million increased 2.7% from the prior-year quarter’s $298 million.
Marine Systems: The segment’s revenues of $2,483 million were up 10.6% from the year-ago quarter’s $2,246 million. Operating earnings also improved 8.7% year over year to $200 million.
Operational Highlights
The operating margin contracted 70 basis points (bps) to 10% from the year-ago quarter’s 10.7%.
In the quarter under review, General Dynamics’ operating costs and expenses rose 8.1% to $8,451 million.
Financial Condition
As of Apr 4, 2021, General Dynamics’ cash and cash equivalents were $1,811 million compared with $2,824 million as of Dec 31, 2020.
Long-term debt as of Apr 4, 2021, was $9,995 million, which remained flat compared to the 2020-end level.
As of Apr 4, 2021, the company’s cash inflow from operating activities was $3 million against the $666 million used in the year-ago period.
Free cash outflow from operations at the end of the first quarter of 2021 was $131 million compared with $851 million at the end of the first quarter of 2020.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in estimates revision.
VGM Scores
At this time, General Dynamics has a subpar Growth Score of D, however its Momentum Score is doing a lot better with a B. Charting a somewhat similar path, the stock was allocated a grade of A on the value side, putting it in the top 20% for this investment strategy.
Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, General Dynamics has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
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How Has GD Performed 30 Days Post Earnings
It has been about a month since the last earnings report for General Dynamics (GD - Free Report) . Shares were flat in that time frame, outperforming the S&P 500.
Will the recent trend continue leading up to its next earnings release, or is General Dynamics due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.
General Dynamics Q1 Earnings Beat, Revenues Up Y/Y
General Dynamics Corporation reported first-quarter 2021 earnings from continuing operations of $2.48 per share, which exceeded the Zacks Consensus Estimate of $2.31 by 7.4%. Moreover, earnings improved 2.1% from $2.43 in the year-ago quarter.
Total Revenues
General Dynamics’ first-quarter revenues of $9,389 million surpassed the Zacks Consensus Estimate of $8,977 million by 4.6%. Further, revenues improved 7.3% from $8,749 million in the year-ago quarter. The decline was primarily attributable to growth in all four segments and growth exceeding 10% in the Aerospace and Marine Systems segments.
Backlog
The company recorded a total backlog of $89.6 billion, up 4.5% year over year. Funded backlog at the quarter-end was $41.8 billion.
Segment Performance
Aerospace: The segment reported revenues of $1,887 million, up 11.6% year over year. Operating earnings of $220 million declined 8.3% from the prior-year quarter’s $240 million.
Combat Systems: Segment revenues improved 6.6% from the prior-year quarter to $1708 million. Moreover, operating earnings were up 9.4% from the year-ago quarter to $244 million.
Technologies: The segment reported revenues of $3,199 million, which increased 3.1% year over year. Operating earnings of $306 million increased 2.7% from the prior-year quarter’s $298 million.
Marine Systems: The segment’s revenues of $2,483 million were up 10.6% from the year-ago quarter’s $2,246 million.
Operating earnings also improved 8.7% year over year to $200 million.
Operational Highlights
The operating margin contracted 70 basis points (bps) to 10% from the year-ago quarter’s 10.7%.
In the quarter under review, General Dynamics’ operating costs and expenses rose 8.1% to $8,451 million.
Financial Condition
As of Apr 4, 2021, General Dynamics’ cash and cash equivalents were $1,811 million compared with $2,824 million as of Dec 31, 2020.
Long-term debt as of Apr 4, 2021, was $9,995 million, which remained flat compared to the 2020-end level.
As of Apr 4, 2021, the company’s cash inflow from operating activities was $3 million against the $666 million used in the year-ago period.
Free cash outflow from operations at the end of the first quarter of 2021 was $131 million compared with $851 million at the end of the first quarter of 2020.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in estimates revision.
VGM Scores
At this time, General Dynamics has a subpar Growth Score of D, however its Momentum Score is doing a lot better with a B. Charting a somewhat similar path, the stock was allocated a grade of A on the value side, putting it in the top 20% for this investment strategy.
Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, General Dynamics has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.