General Dynamics (GD) Downgraded to Sell at Zacks Investment Research
Zacks Investment Research cut shares of General Dynamics (NYSE:GD) from a hold rating to a sell rating in a research note released on Monday morning.
According to Zacks, “General Dynamics is susceptible to interest rate risk related to the issuance of debt. A material rise in long-term interest rates is a major risk for capital intensive stocks like General Dynamics. With the current U.S. economy being in favor of the expanding interest rate, the credit market may not be much favorable for General Dynamics. The company’s sharesalso underperformed its industry in the past twelve months. The company operates in a highly competitive market where some competitors may have extensive or specialized business segments, superior to General Dynamics. However, the company boasts a strong position in the U.S. defense space and overseas. Apart from solid demand for its varied defense products leading to organic growth, a notable acquisition strategy also adds significant value to General Dynamics’ inorganic growth.”
A number of other brokerages also recently weighed in on GD. Jefferies Financial Group downgraded General Dynamics from a buy rating to a hold rating and cut their price objective for the company from $197.00 to $164.00 in a research note on Tuesday, January 8th. Morgan Stanley cut their price objective on General Dynamics from $209.00 to $189.00 and set an underweight rating on the stock in a research note on Wednesday, November 14th. Citigroup cut their price objective on General Dynamics from $195.00 to $175.00 and set a neutral rating on the stock in a research note on Monday, January 14th. Credit Suisse Group reaffirmed a buy rating and issued a $190.00 price target on shares of General Dynamics in a research report on Monday, January 14th. Finally, Drexel Hamilton reaffirmed a buy rating and issued a $230.00 price target on shares of General Dynamics in a research report on Monday, February 4th. Four research analysts have rated the stock with a sell rating, nine have given a hold rating and seven have assigned a buy rating to the company. The stock has an average rating of Hold and a consensus target price of $207.88.
General Dynamics (NYSE:GD) last issued its quarterly earnings data on Wednesday, January 30th. The aerospace company reported $3.07 earnings per share for the quarter, beating the Zacks’ consensus estimate of $2.98 by $0.09. General Dynamics had a return on equity of 28.33% and a net margin of 9.24%. The business had revenue of $10.38 billion for the quarter, compared to the consensus estimate of $10.34 billion. During the same period last year, the business earned $2.50 EPS. The firm’s revenue was up 25.4% compared to the same quarter last year. On average, research analysts forecast that General Dynamics will post 11.72 EPS for the current year.
The firm also recently declared a quarterly dividend, which will be paid on Friday, May 10th. Shareholders of record on Friday, April 12th will be given a $1.02 dividend. This is an increase from General Dynamics’s previous quarterly dividend of $0.93. This represents a $4.08 annualized dividend and a yield of 2.41%. The ex-dividend date of this dividend is Thursday, April 11th. General Dynamics’s payout ratio is currently 32.57%.
In other news, VP Gary L. Whited sold 14,640 shares of General Dynamics stock in a transaction that occurred on Friday, March 8th. The stock was sold at an average price of $165.38, for a total transaction of $2,421,163.20. Following the sale, the vice president now owns 30,462 shares of the company’s stock, valued at approximately $5,037,805.56. The sale was disclosed in a legal filing with the Securities & Exchange Commission, which is available through the SEC website. Also, VP Christopher J. Brady sold 2,327 shares of General Dynamics stock in a transaction that occurred on Monday, February 4th. The stock was sold at an average price of $171.23, for a total value of $398,452.21. Following the sale, the vice president now directly owns 5,134 shares in the company, valued at approximately $879,094.82. The disclosure for this sale can be found here. Over the last ninety days, insiders sold 21,547 shares of company stock worth $3,609,299. Company insiders own 6.90% of the company’s stock.
Large investors have recently made changes to their positions in the company. Ontario Teachers Pension Plan Board grew its holdings in shares of General Dynamics by 256.4% during the 3rd quarter. Ontario Teachers Pension Plan Board now owns 7,364 shares of the aerospace company’s stock worth $1,508,000 after purchasing an additional 5,298 shares in the last quarter. U S Global Investors Inc. grew its holdings in shares of General Dynamics by 3.4% during the 4th quarter. U S Global Investors Inc. now owns 15,151 shares of the aerospace company’s stock worth $2,382,000 after purchasing an additional 499 shares in the last quarter. Alerus Financial NA grew its holdings in shares of General Dynamics by 19.8% during the 3rd quarter. Alerus Financial NA now owns 20,878 shares of the aerospace company’s stock worth $3,511,000 after purchasing an additional 3,446 shares in the last quarter. Tompkins Financial Corp grew its holdings in shares of General Dynamics by 3.8% during the 4th quarter. Tompkins Financial Corp now owns 16,406 shares of the aerospace company’s stock worth $2,579,000 after purchasing an additional 608 shares in the last quarter. Finally, Miracle Mile Advisors LLC acquired a new stake in shares of General Dynamics during the 4th quarter worth approximately $241,000. 87.49% of the stock is currently owned by institutional investors.
General Dynamics Company Profile
General Dynamics Corporation operates as an aerospace and defense company worldwide. It operates in five segments: Aerospace, Combat Systems, Information Technology, Mission Systems, and Marine Systems. The Aerospace segment designs, manufactures, and supports business-jet aircraft; and offers business-aviation services, including maintenance, fixed-base operation, government fleet, aircraft management, charter, and staffing services, as well as integrated aviation solutions.
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