General Dynamics (GD) is a global aerospace and defense contractor. The company consistently beats analysts' consensus estimates and generates high single-digit to low double-digit earnings growth. While budgetary concerns in Washington, D.C., may lead one to believe that General Dynamics may feel the fiscal pinch, I think that may be a naive generalization. With the Arab Spring continuing into the Arab Fall and likely beyond, continued problems in Afghanistan, piracy on the high seas and the increasing military needs of nations with emerging economies, General Dynamics should continue to generate reasonable earnings growth.
Selling 8.78 times 2011 estimates and 8.39 times forward estimates with a near-3% dividend, this company's shares are quite reasonably valued. Recently, General Dynamics reported third-quarter earnings of $1.83, which was better than consensus estimates of $1.77. This resulted in upward full-year EPS consensus revision of 4 cents for the company from 16 analysts. For the fourth quarter, analysts expect GD to earn $1.98, which is 3 cents greater than it was a month ago.
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