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General Dynamics' (GD) Board Approves 7.6% Dividend Hike
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General Dynamics (GD - Free Report) recently announced that its board of directors has approved a 7.6% increase in the quarterly dividend rate. The revised quarterly dividend will be $1.42, payable on May 10, 2024, to shareholders of record at the close of business on Apr 12.
General Dynamics has been consistently increasing dividends for the past 27 years. The company’s new annualized dividend rate is $5.68 per share, resulting in an annualized dividend yield of 2.08%, based on its share price of $273.03 as of Mar 7, 2024. The current dividend yield is better than the Zacks S&P 500 composite’s 1.32%.
Can We Expect Hikes in the Coming Years?
General Dynamics’ dividend payment history indicates that the company has been performing steadily and generating enough cash flow to distribute dividends to shareholders.
Evidently, as of Dec 31, 2023, General Dynamics had a total cash and cash equivalents of $1.91 billion, reflecting an improvement from $1.24 billion on Dec 31, 2022. For 2023, the company had cash inflow from operating activities worth $4.71 billion, up 2.9% from the prior-year tally.
Such solid cash balance is likely to have enabled General Dynamics to pay $1.43 billion as dividends to its shareholders in 2023, which reflected an increase of 4.3% from the year-ago amount.
It is imperative to mention that the company ended 2023 with a backlog of $93.63 billion, the highest year-end backlog in the company’s history. This reflects that the solid demand for GD’s products is likely to have led to strong order activity, thereby boosting its long-term growth expectations. Successful deliveries of its products from backlog can be expected to bolster GD’s future operating results, enabling the company to continue rewarding its shareholders with regular dividend hikes in the coming years.
Dividend History of Peers
General Dynamics is not the only one in the aerospace-defense space that has a consistent history of dividend hikes. Many other players have a similar track record.
BAE Systems (BAESY - Free Report) : On Feb 21, 2024, BAE Systems increased its quarterly dividend to 90 cents per share, representing 63.6% growth from the previous quarter. The company’s annualized dividend rate is $3.60 per share.
The current dividend yield of BEASY is 1.67%, better than the Zacks S&P 500 composite’s yield of 1.32%. The stock’s long-term (three to five years) earnings growth is pegged at 12.9%.
Lockheed Martin (LMT - Free Report) : On Oct 6, 2023, Lockheed Martin increased its quarterly dividend to $3.15 per share, representing 5% growth from the previous quarter. The company’s annualized dividend rate is $12.60 per share. LMT’s payout currently is 45% of earnings.
The current dividend yield of LMT is 2.91%, better than the Zacks S&P 500 composite’s yield of 1.32%. The stock’s long-term earnings growth is pegged at 4.2%.
L3Harris Technologies (LHX - Free Report) : On Feb 23, 2024, L3Harris increased its quarterly dividend to $1.16 per share, representing 1.8% growth from the previous quarter. The company’s annualized dividend rate is $4.64 per share. LHX’s payout currently is 37% of earnings.
The current dividend yield of LHX is 2.12%, better than the Zacks S&P 500 composite’s yield of 1.32%. The stock’s long-term earnings growth is pegged at 8.4%.
Image: Bigstock
General Dynamics' (GD) Board Approves 7.6% Dividend Hike
General Dynamics (GD - Free Report) recently announced that its board of directors has approved a 7.6% increase in the quarterly dividend rate. The revised quarterly dividend will be $1.42, payable on May 10, 2024, to shareholders of record at the close of business on Apr 12.
General Dynamics has been consistently increasing dividends for the past 27 years. The company’s new annualized dividend rate is $5.68 per share, resulting in an annualized dividend yield of 2.08%, based on its share price of $273.03 as of Mar 7, 2024. The current dividend yield is better than the Zacks S&P 500 composite’s 1.32%.
Can We Expect Hikes in the Coming Years?
General Dynamics’ dividend payment history indicates that the company has been performing steadily and generating enough cash flow to distribute dividends to shareholders.
Evidently, as of Dec 31, 2023, General Dynamics had a total cash and cash equivalents of $1.91 billion, reflecting an improvement from $1.24 billion on Dec 31, 2022. For 2023, the company had cash inflow from operating activities worth $4.71 billion, up 2.9% from the prior-year tally.
Such solid cash balance is likely to have enabled General Dynamics to pay $1.43 billion as dividends to its shareholders in 2023, which reflected an increase of 4.3% from the year-ago amount.
It is imperative to mention that the company ended 2023 with a backlog of $93.63 billion, the highest year-end backlog in the company’s history. This reflects that the solid demand for GD’s products is likely to have led to strong order activity, thereby boosting its long-term growth expectations. Successful deliveries of its products from backlog can be expected to bolster GD’s future operating results, enabling the company to continue rewarding its shareholders with regular dividend hikes in the coming years.
Dividend History of Peers
General Dynamics is not the only one in the aerospace-defense space that has a consistent history of dividend hikes. Many other players have a similar track record.
BAE Systems (BAESY - Free Report) : On Feb 21, 2024, BAE Systems increased its quarterly dividend to 90 cents per share, representing 63.6% growth from the previous quarter. The company’s annualized dividend rate is $3.60 per share.
The current dividend yield of BEASY is 1.67%, better than the Zacks S&P 500 composite’s yield of 1.32%. The stock’s long-term (three to five years) earnings growth is pegged at 12.9%.
Lockheed Martin (LMT - Free Report) : On Oct 6, 2023, Lockheed Martin increased its quarterly dividend to $3.15 per share, representing 5% growth from the previous quarter. The company’s annualized dividend rate is $12.60 per share. LMT’s payout currently is 45% of earnings.
The current dividend yield of LMT is 2.91%, better than the Zacks S&P 500 composite’s yield of 1.32%. The stock’s long-term earnings growth is pegged at 4.2%.
L3Harris Technologies (LHX - Free Report) : On Feb 23, 2024, L3Harris increased its quarterly dividend to $1.16 per share, representing 1.8% growth from the previous quarter. The company’s annualized dividend rate is $4.64 per share. LHX’s payout currently is 37% of earnings.
The current dividend yield of LHX is 2.12%, better than the Zacks S&P 500 composite’s yield of 1.32%. The stock’s long-term earnings growth is pegged at 8.4%.
Zacks Rank
GD currently has a Zacks Rank #4 (Sell).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Price Performance
In the past year, shares of GD have rallied 22.5% against the industry’s 7.3% decline.
Image Source: Zacks Investment Research