General Dynamics Q3 revenue beats on submarine orders

Overview

• Aerospace and defense firm's Q3 revenue rose 12.9% yr/yr, beating analyst expectations

• Q3 diluted EPS rose 15.7% yr/yr

• Company reported book-to-bill ratio of 6.8-to-1 and backlog of $220 bln

Outlook

• Company expects continued performance supported by growing backlog and prior investments

• Company backlog stands at $220.3 bln, supporting future revenue visibility

• Company cites robust order intake, indicating strong demand for defense and aerospace products

Result Drivers

• SEGMENT GROWTH - Co said revenue growth occurred across all four business segments, per CEO Phebe Novakovic

• MARINE SYSTEMS ORDERS - Large orders for Virginia- and Columbia-class submarines drove defense segment bookings

• MARGIN EXPANSION - Co reported a 20-basis-point increase in operating margin compared to prior year

Company press release:

Key Details

Analyst Coverage

• The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 15 "strong buy" or "buy", 9 "hold" and 1 "sell" or "strong sell"

• The average consensus recommendation for the aerospace & defense peer group is "buy"

• Wall Street's median 12-month price target for General Dynamics Corp is $400.00, about 7.9% above its October 29 closing price of $370.82

• The stock recently traded at 20 times the next 12-month earnings vs. a P/E of 20 three months ago

Reuters Recommended Reads

• Oct 29 - L3Harris beats Q3 revenue estimates, raises FY guidance range

• Oct 29 - Huntington Ingalls Q3 revenue beats on shipbuilding volumes

• Oct 29 - Kongsberg Q3 orders jump on strong missile, air defence demand

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(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)