General Dynamics (GD): Today's Featured Aerospace/Defense Laggard

Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.

General Dynamics ( GD) pushed the Aerospace/Defense industry lower today making it today's featured Aerospace/Defense laggard. The industry as a whole closed the day up 0.1%. By the end of trading, General Dynamics fell 78 cents (-1.2%) to $65.16 on average volume. Throughout the day, 1.3 million shares of General Dynamics exchanged hands as compared to its average daily volume of 1.7 million shares. The stock ranged in price between $65.06-$66.06 after having opened the day at $65.92 as compared to the previous trading day's close of $65.94. Other companies within the Aerospace/Defense industry that declined today were: AerCap Holdings N.V ( AER), down 1.9%, Rockwell Collins ( COL), down 1.7%, and CAE ( CAE), down 1.7%.
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General Dynamics Corporation, an aerospace and defense company, provides business aviation; combat vehicles, weapons systems, and munitions; military and commercial shipbuilding; and communications and information technology products and services worldwide. General Dynamics has a market cap of $23.44 billion and is part of the industrial goods sector. The company has a P/E ratio of 9.5, below the average aerospace/defense industry P/E ratio of 9.7 and below the S&P 500 P/E ratio of 17.7. Shares are down 0.7% year to date as of the close of trading on Tuesday. Currently there are 12 analysts that rate General Dynamics a buy, no analysts rate it a sell, and six rate it a hold.

TheStreet Ratings rates General Dynamics as a buy. The company's strengths can be seen in multiple areas, such as its revenue growth, attractive valuation levels, good cash flow from operations, increase in stock price during the past year and largely solid financial position with reasonable debt levels by most measures. We feel these strengths outweigh the fact that the company has had sub par growth in net income.

For investors not wanting singular stock exposure, ETFs may be of interest. Investors who are bullish on the aerospace/defense industry could consider iShares DJ US Aerospace & Def Idx ( ITA) while those bearish on the aerospace/defense industry could consider ProShares Short Dow 30 ( DOG).

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