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Why General Dynamics (GD) Outpaced the Stock Market Today

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General Dynamics (GD - Free Report) closed the most recent trading day at $282.49, moving +0.21% from the previous trading session. The stock outperformed the S&P 500, which registered a daily gain of 0.11%. Elsewhere, the Dow gained 0.12%, while the tech-heavy Nasdaq lost 0.12%.

Prior to today's trading, shares of the defense contractor had gained 2.77% over the past month. This has lagged the Aerospace sector's gain of 3.33% and the S&P 500's gain of 3.55% in that time.

The upcoming earnings release of General Dynamics will be of great interest to investors. The company is expected to report EPS of $3.12, up 18.18% from the prior-year quarter. Meanwhile, the latest consensus estimate predicts the revenue to be $10.75 billion, indicating an 8.76% increase compared to the same quarter of the previous year.

For the full year, the Zacks Consensus Estimates are projecting earnings of $14.59 per share and revenue of $46.54 billion, which would represent changes of +21.38% and +10.1%, respectively, from the prior year.

Any recent changes to analyst estimates for General Dynamics should also be noted by investors. Such recent modifications usually signify the changing landscape of near-term business trends. Therefore, positive revisions in estimates convey analysts' confidence in the company's business performance and profit potential.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To capitalize on this, we've crafted the Zacks Rank, a unique model that incorporates these estimate changes and offers a practical rating system.

The Zacks Rank system, spanning from #1 (Strong Buy) to #5 (Strong Sell), boasts an impressive track record of outperformance, audited externally, with #1 ranked stocks yielding an average annual return of +25% since 1988. Over the past month, there's been a 0.19% fall in the Zacks Consensus EPS estimate. As of now, General Dynamics holds a Zacks Rank of #3 (Hold).

Digging into valuation, General Dynamics currently has a Forward P/E ratio of 19.32. This indicates a premium in contrast to its industry's Forward P/E of 18.45.

It is also worth noting that GD currently has a PEG ratio of 1.79. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. As of the close of trade yesterday, the Aerospace - Defense industry held an average PEG ratio of 1.95.

The Aerospace - Defense industry is part of the Aerospace sector. This group has a Zacks Industry Rank of 142, putting it in the bottom 44% of all 250+ industries.

The Zacks Industry Rank evaluates the power of our distinct industry groups by determining the average Zacks Rank of the individual stocks forming the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

To follow GD in the coming trading sessions, be sure to utilize Zacks.com.

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