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Why the Market Dipped But General Dynamics (GD) Gained Today

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General Dynamics (GD - Free Report) closed the latest trading day at $296.08, indicating a +0.89% change from the previous session's end. The stock outpaced the S&P 500's daily loss of 0.6%. Meanwhile, the Dow experienced a drop of 0.86%, and the technology-dominated Nasdaq saw a decrease of 1.08%.

Shares of the defense contractor witnessed a gain of 2.43% over the previous month, beating the performance of the Aerospace sector with its gain of 0.34% and underperforming the S&P 500's gain of 3.15%.

The upcoming earnings release of General Dynamics will be of great interest to investors. The company is forecasted to report an EPS of $3.34, showcasing a 23.7% upward movement from the corresponding quarter of the prior year. Simultaneously, our latest consensus estimate expects the revenue to be $11.49 billion, showing a 13.17% escalation compared to the year-ago quarter.

GD's full-year Zacks Consensus Estimates are calling for earnings of $14.55 per share and revenue of $46.72 billion. These results would represent year-over-year changes of +21.05% and +10.53%, respectively.

Investors should also pay attention to any latest changes in analyst estimates for General Dynamics. Such recent modifications usually signify the changing landscape of near-term business trends. Consequently, upward revisions in estimates express analysts' positivity towards the company's business operations and its ability to generate profits.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Within the past 30 days, our consensus EPS projection remained stagnant. General Dynamics is currently sporting a Zacks Rank of #3 (Hold).

Investors should also note General Dynamics's current valuation metrics, including its Forward P/E ratio of 20.17. Its industry sports an average Forward P/E of 18.18, so one might conclude that General Dynamics is trading at a premium comparatively.

We can additionally observe that GD currently boasts a PEG ratio of 1.67. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. The Aerospace - Defense industry had an average PEG ratio of 1.74 as trading concluded yesterday.

The Aerospace - Defense industry is part of the Aerospace sector. Currently, this industry holds a Zacks Industry Rank of 97, positioning it in the top 39% of all 250+ industries.

The Zacks Industry Rank assesses the vigor of our specific industry groups by computing the average Zacks Rank of the individual stocks incorporated in the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

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