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General Dynamics (GD) Beats on Q4 Earnings, Sales Up Y/Y
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General Dynamics Corporation (GD - Free Report) reported fourth quarter and 2018 results. Fourth-quarter earnings from continuing operations of $3.07 per share beat the Zacks Consensus Estimate of $2.98 by 3%. Reported earnings were up 46.2% from $2.10 in the year-ago quarter.
For 2018, the company reported earnings of $11.22 per share, up 17.4% from $9.56 in the year-ago quarter. Moreover, full-year earnings figure exceeded the Zacks Consensus Estimate of $11.15 by 0.6%.
Total Revenues
General Dynamics’ fourth-quarter revenues of $10,378 million surpassed the Zacks Consensus Estimate of $10,286 million by 0.9%. Further, revenues increased 25.4% from $8,277 million in the year-ago quarter. Revenues grew year over year in three of the company’s five segments.
In 2018, total revenues increased 16.9% year over year to $36.19 billion. Full-year revenues surpassed the Zacks Consensus Estimate of $36.13 billion by a mere 0.2%.
Backlog
The company recorded a total backlog of $67.9 billion, up 7.4% annually. Funded backlog at the quarter end was $55.83 billion.
Segment Performance
Aerospace: The segment reported revenues of $2,704 million, up 36.4% year over year. Operating earnings of $382 million increased 13.7% from the prior-year quarter’s $336 million.
Combat Systems: Segment revenues fell 0.2% to $1,744 million. Operating earnings were up 0.4% to $261 million in the quarter.
Information Systems and Technology: The segment reported revenues of $2,382 million, which surged 93.3% year over year. Operating income also surged 104.2% to $194 million.
Marine Systems: The segment’s revenues of $2,297 million were up 11.5% from the year-ago figure of $2,060 million. Moreover, operating income rose 27.5% to $213 million.
Mission Systems: The segment’s revenues of $1,251 million were down 0.3% from the year-ago quarter’s $1,255 million. Operating income declined 3.2 % from the year-ago quarter’s $187 million to $181 million.
General Dynamics Corporation Price, Consensus and EPS Surprise
Company-wide operating margin contracted 100 basis points (bps) to 11.8% from the year-ago quarter’s level of 12.8%.
In the quarter under review, General Dynamics’ operating costs and expenses rose 26.8% to $9,152 million.
The company repurchased 7.6 million of its outstanding shares in the fourth quarter of 2018, and 10.1 million of its outstanding shares for $1.8 billion for the year. The company paid out $1.1 billion in dividends in 2018.
Financial Condition
As of Dec 31, 2018, General Dynamics’ cash and cash equivalents were $963 million compared with $2,983 million as of Dec 31, 2017.
Long-term debt as of Dec 31, 2018 was $11,444 million, which witnessed a massive rise from the 2017-end level of $3,980 million.
As of Dec 31, 2018, the company’s cash provided by operating activities were $3,148 million compared with $3,876 million in the year-ago period.
Free cash flow from operations at the end of 2018 was $2.5 billion, compared to $3.45 billion at 2017-end.
Teledyne Technologies (TDY - Free Report) reported adjusted fourth-quarter 2018 earnings of $2.33 per share, which surpassed the Zacks Consensus Estimate of $2.19 by 6.4%. The bottom line also improved 27.3% from the year-ago quarter’s figure of $1.83.
Textron (TXT - Free Report) reported fourth-quarter 2018 adjusted earnings from continuing operations of $1.15 per share, which surpassed the Zacks Consensus Estimate of 98 cents by 17.3%. The bottom line also surged 55.4% from 74 cents in the year-ago quarter.
Hexcel Corporation (HXL - Free Report) reported fourth-quarter 2018 adjusted earnings of 82 cents per share, exceeding the Zacks Consensus Estimate of 80 cents by 2.5%. Further, the bottom line improved 17.1% from the prior-year quarter’s 70 cents.
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General Dynamics (GD) Beats on Q4 Earnings, Sales Up Y/Y
General Dynamics Corporation (GD - Free Report) reported fourth quarter and 2018 results. Fourth-quarter earnings from continuing operations of $3.07 per share beat the Zacks Consensus Estimate of $2.98 by 3%. Reported earnings were up 46.2% from $2.10 in the year-ago quarter.
For 2018, the company reported earnings of $11.22 per share, up 17.4% from $9.56 in the year-ago quarter. Moreover, full-year earnings figure exceeded the Zacks Consensus Estimate of $11.15 by 0.6%.
Total Revenues
General Dynamics’ fourth-quarter revenues of $10,378 million surpassed the Zacks Consensus Estimate of $10,286 million by 0.9%. Further, revenues increased 25.4% from $8,277 million in the year-ago quarter. Revenues grew year over year in three of the company’s five segments.
In 2018, total revenues increased 16.9% year over year to $36.19 billion. Full-year revenues surpassed the Zacks Consensus Estimate of $36.13 billion by a mere 0.2%.
Backlog
The company recorded a total backlog of $67.9 billion, up 7.4% annually. Funded backlog at the quarter end was $55.83 billion.
Segment Performance
Aerospace: The segment reported revenues of $2,704 million, up 36.4% year over year. Operating earnings of $382 million increased 13.7% from the prior-year quarter’s $336 million.
Combat Systems: Segment revenues fell 0.2% to $1,744 million. Operating earnings were up 0.4% to $261 million in the quarter.
Information Systems and Technology: The segment reported revenues of $2,382 million, which surged 93.3% year over year. Operating income also surged 104.2% to $194 million.
Marine Systems: The segment’s revenues of $2,297 million were up 11.5% from the year-ago figure of $2,060 million. Moreover, operating income rose 27.5% to $213 million.
Mission Systems: The segment’s revenues of $1,251 million were down 0.3% from the year-ago quarter’s $1,255 million. Operating income declined 3.2 % from the year-ago quarter’s $187 million to $181 million.
General Dynamics Corporation Price, Consensus and EPS Surprise
General Dynamics Corporation Price, Consensus and EPS Surprise | General Dynamics Corporation Quote
Operational Highlights
Company-wide operating margin contracted 100 basis points (bps) to 11.8% from the year-ago quarter’s level of 12.8%.
In the quarter under review, General Dynamics’ operating costs and expenses rose 26.8% to $9,152 million.
The company repurchased 7.6 million of its outstanding shares in the fourth quarter of 2018, and 10.1 million of its outstanding shares for $1.8 billion for the year. The company paid out $1.1 billion in dividends in 2018.
Financial Condition
As of Dec 31, 2018, General Dynamics’ cash and cash equivalents were $963 million compared with $2,983 million as of Dec 31, 2017.
Long-term debt as of Dec 31, 2018 was $11,444 million, which witnessed a massive rise from the 2017-end level of $3,980 million.
As of Dec 31, 2018, the company’s cash provided by operating activities were $3,148 million compared with $3,876 million in the year-ago period.
Free cash flow from operations at the end of 2018 was $2.5 billion, compared to $3.45 billion at 2017-end.
Zacks Rank
General Dynamics currently carries a Zacks Rank #3 (Hold).You can see the complete list of today’s Zacks #1 (Strong Buy) Rank stocks here.
Recent Defense Releases
Teledyne Technologies (TDY - Free Report) reported adjusted fourth-quarter 2018 earnings of $2.33 per share, which surpassed the Zacks Consensus Estimate of $2.19 by 6.4%. The bottom line also improved 27.3% from the year-ago quarter’s figure of $1.83.
Textron (TXT - Free Report) reported fourth-quarter 2018 adjusted earnings from continuing operations of $1.15 per share, which surpassed the Zacks Consensus Estimate of 98 cents by 17.3%. The bottom line also surged 55.4% from 74 cents in the year-ago quarter.
Hexcel Corporation (HXL - Free Report) reported fourth-quarter 2018 adjusted earnings of 82 cents per share, exceeding the Zacks Consensus Estimate of 80 cents by 2.5%. Further, the bottom line improved 17.1% from the prior-year quarter’s 70 cents.
Zacks' Top 10 Stocks for 2019
In addition to the stocks discussed above, wouldn't you like to know about our 10 finest buy-and-holds for the year?
From more than 4,000 companies covered by the Zacks Rank, these 10 were picked by a process that consistently beats the market. Even during 2018 while the market dropped -5.2%, our Top 10s were up well into double-digits. And during bullish 2012 – 2017, they soared far above the market's +126.3%, reaching +181.9%.
This year, the portfolio features a player that thrives on volatility, an AI comer, and a dynamic tech company that helps doctors deliver better patient outcomes at lower costs.
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