General Dynamics Misses on Both Revenue and Earnings

Seth Jayson, The Motley Fool
Updated

General Dynamics (NYS: GD) reported earnings on April 25. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended April 1 (Q1), General Dynamics missed estimates on revenue and missed estimates on earnings per share.

Compared to the prior-year quarter, revenue shrank slightly and GAAP earnings per share dropped.


Margins dropped across the board.

Revenue details
General Dynamics notched revenue of $7.58 billion. The 16 analysts polled by S&P Capital IQ foresaw revenue of $7.91 billion on the same basis. GAAP reported sales were 2.8% lower than the prior-year quarter's $7.80 billion.

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Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.

EPS details
EPS came in at $1.57. The 21 earnings estimates compiled by S&P Capital IQ predicted $1.69 per share. GAAP EPS of $1.57 for Q1 were 4.3% lower than the prior-year quarter's $1.64 per share.

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Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.

Margin details
For the quarter, gross margin was 11.3%, 710 basis points worse than the prior-year quarter. Operating margin was 11.3%, 60 basis points worse than the prior-year quarter. Net margin was 7.4%, 50 basis points worse than the prior-year quarter.

Looking ahead
Next quarter's average estimate for revenue is $8.08 billion. On the bottom line, the average EPS estimate is $1.76.

Next year's average estimate for revenue is $33.05 billion. The average EPS estimate is $7.29.

Investor sentiment
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 1,295 members out of 1,360 rating the stock outperform, and 65 members rating it underperform. Among 327 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 315 give General Dynamics a green thumbs-up, and 12 give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on General Dynamics is outperform, with an average price target of $79.00.

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At the time thisarticle was published Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor ofMotley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. The Motley Fool owns shares of General Dynamics. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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