Start here if you're new
what it is
General Dynamics builds business jets, warships, tanks, and military tech.
how it gets paid
Last year L. Dynamics made $52.5B in revenue. Marine Systems was the main engine at $16.8B, or 32% of sales.
why it's growing
Revenue grew 10.1% last year. Order activity and backlog remains strong, with an overall book-to-bill ratio of 1.6-to-1 for the quarter, and 1.5-to-one for the year.
what just happened
General Dynamics beat with $4.17 a share, 1.21% above estimates.
At a glance
A+ balance sheet — rock-solid finances — built to survive anything
100/100 earnings predictability — you can trust these numbers
22.5x trailing p/e — priced about right
2.0% dividend yield — cash in your pocket every quarter
14.0% return on capital — nothing to write home about
xvary composite: 81/100 — above average
What they do
General Dynamics builds business jets, warships, tanks, and military tech.
You are not buying a normal industrial company. You are buying a business with 117,000 employees and four segments, and replacing that setup is painful. The contrast is blunt: 69% of revenue comes from the U.S. government, while foreign sales are only 18%.
How they make money
$52.5B
annual revenue · their business grew +10.1% last year
Aerospace
$13.1B
Marine Systems
$16.8B
Combat Systems
$9.5B
Technologies
$13.1B
The products that matter
builds submarines and naval platforms
Marine Systems
$16.8B · 32% of revenue
it's the largest segment at $16.8B, or 32% of sales. This is where the long-cycle defense exposure lives, and why backlog matters so much here.
32% of revenue
manufactures Gulfstream aircraft
Aerospace
$13.1B · +16.5% growth
this $13.1B segment grew 16.5% last year. That's faster than the rest of the company. The quiet part: private jets are doing real work inside a stock many people file under defense and move on.
fastest grower
mission systems and government tech
Technologies
$13.1B · 25% of revenue
it's another $13.1B business, matching Aerospace in size. You are not just buying ships and tanks. A full quarter of revenue comes from technology and service-heavy government work.
25% of revenue
Key numbers
$52.5B
revenue
This is a $52.5B machine, so you are buying scale, not a one-program story.
69%
gov't sales
Seven of every ten revenue dollars come from the U.S. government, so one customer can move the stock.
22.5x
trailing p/e
You pay 22.5 times trailing earnings, while the upside to the VL target is only 6%.
14.0%
operating margin
For every $100 in sales, $14 stays before interest and taxes. That is good, not magical.
Financial health
A+
strength
- balance sheet grade A+ — near the highest rating possible
- risk rank 1 — safer than 95% of stocks
- price stability 100 / 100
- long-term debt $7.0B (7% of capital)
- net profit margin 9.7% — keeps 10 cents of every dollar in revenue
- return on equity 16% — $0.16 profit for every $1 investors have put in
A+ — among the top-rated companies for balance sheet quality.
Total return vs. market
You invested $10,000 in GD 3 years ago → it's now worth $15,890.
The index would have given you $13,880.
source: institutional data · total return
What just happened
beat estimates
General Dynamics beat with $4.17 a share, 1.21% above estimates.
Annual revenue rose 10.1% to $52.5B, and full-year EPS climbed from $13.63 to $15.45. That is a clean year, not a blowout.
$52.5B
revenue
$4.17
eps
14.0%
operating margin
beat size
The 1.21% EPS beat mattered because a stock at 22.5x trailing earnings does not get much forgiveness.
-
general dynamics closed the books on a very solid year.
-
revenue comparisons were strong throughout 2025, advancing 10% in total, to just under $52.6 billion.while growth was reported in all four of the company’s segments, the higher-margin aerospace segment was a major contributor.
-
the top line there increased 16.5% vs. prior year, to $13.1 billion, thanks to high demand for new aircraft, such as the gulfstream g700 and g800 business jets.the marine systems division was also a standout, reflecting accelerated submarine production, while the combat systems business benefited from robust sales of munitions and vehicles.
-
altogether, profits increased 13% vs. prior year, to a record $15.45 a share.
-
operating performance should continue to improve over the near term.order activity and backlog remains strong, with an overall book-to-bill ratio of 1.6-to-1 for the quarter, and 1.5-to-one for the year.
source: company earnings report, 2026
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What could go wrong
the main risk is timing inside a business that looks steadier than it really is. GD gets defensive-stock treatment because 69% of revenue comes from government customers. That helps until funding, production, or mix stops lining up.
med
defense funding delays would hit the biggest part of the story
About 69% of revenue is tied to the U.S. government. On a $52.5B revenue base, that is roughly $36.2B exposed to appropriations, timing, and procurement priorities.
If Pentagon timing slips, backlog can stay healthy while cash conversion and revenue recognition slow anyway.
med
the fastest-growing segment is also the one most tied to private demand
Aerospace produced $13.1B of revenue and grew 16.5% last year. That's a quarter of the company, and it is helping offset the slower, steadier defense cadence.
If corporate jet demand cools, the growth mix gets more defense-heavy again — safer, but slower.
med
there is not much room to hide behind giant margins
Operating margin was 12.5% and net margin was 8.5%. This is a well-run industrial, not a software company printing 30% margins.
Cost overruns, program execution misses, or weaker mix can pressure earnings faster than the stock's calm reputation suggests.
med
the stock already gets credit for being dependable
GD trades at 22.5x trailing earnings and about 21.1x forward earnings. That is a respectable multiple for a company with 100 / 100 earnings predictability and a risk rank of 1.
If growth slips back toward the slower parts of the business, you still own a good company. You just stop owning a stock with much room for re-rating.
The key issue is simple: a steadier business is still exposed to government timing, Gulfstream demand, and margin discipline. If more than one of those slips at once, the safety narrative does not protect the multiple.
source: institutional data · regulatory filings · risk analysis
Pay attention to
growth mix
whether Aerospace keeps outrunning the rest of the company
Aerospace grew 16.5% versus 10.1% for total revenue. If that spread narrows, part of the premium story narrows with it.
backlog
book-to-bill staying above 1.0
It was 1.6-to-1 for the quarter and 1.5-to-1 for the year. Above 1.0 means orders are replacing revenue. Below 1.0 means backlog starts leaking.
customer concentration
how much comfort you really take from 69% government exposure
That concentration creates stability, but it also means Washington timing matters more here than in most industrial names.
earnings
whether revenue growth keeps turning into EPS growth
Last year revenue rose 10% and EPS rose 13% to $15.45. You want that relationship to keep holding if the stock is going to earn more upside.
Analyst rankings
short-term outlook
average
outlook rank 3 — in human-speak, analysts see a normal market performer here, not an obvious near-term breakout.
risk profile
safest 5%
risk rank 1 — lower downside risk than almost any stock in the market. That's the appeal.
chart momentum
top 20%
momentum rank 2 — recent price action has been stronger than most stocks, but this is still a steady climber, not a rocket.
earnings predictability
100 / 100
management tends to deliver what the market expects. That lowers drama, which is exactly why many shareholders are here.
source: institutional data
Institutional activity
institutions have been net buying for 3 consecutive quarters — 997 buyers vs. 730 sellers in 3q2025. total institutional holdings: 0.2B shares. net buying for 3 quarters.
source: institutional data
Price targets
3-5 year target range
$287
$452
$348
current price
$370
target midpoint · +6% from current · 3-5yr high: $480 (+40% · 10% ann'l return)
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