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What this page is: Delvantic's full research page for General Dynamics Corporation (GD) — AI-driven forensic equity research: mechanical valuation models (DCF, EPV, anchored-PE, scenario) plus three independent AI lenses (Quality / Value / Sentiment). Everything below is rendered server-side; you are not missing content that requires JavaScript. All scores are predictions and research opinions, not financial advice.
Our current read (analysis of 2026-08-09): Designation Watch · Cairn score -6 (−100…+100 Quality+Value blend) · Quality 64 · Value -63 · Sentiment 27 (timing only, not weighted) · Composite fair value $316.09 vs $392.05 at analysis
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reference-name attribute you can cite):
profile-header/price-overview— company profile, live quote, market capextended-analysis— the core: three AI lens reads with findings, scores, and the analyst memofuture-predictions— our forward price-band predictionsmarket-narrative/ai-findings/gpt-critique— narrative context, cross-model findings, and an adversarial critique of our own analysis (near the end of the document)- Members-only sections (render as login gates for anonymous readers):
price-history,income-trend,key-metrics,financials(statement tables),insider-trading. The analysis above is public; the raw data tables require a free account.
More for machine readers: site briefing at
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any ticker resolves at delvantic.com/stock/TICKER ·
raw inputs are public-company filings and market data (via licensed data feeds);
every model, score, lens read, and prediction on this page is Delvantic's own analysis.
General Dynamics Corporation is a global aerospace and defense company that develops and supports a broad portfolio of products and services for government and commercial customers. Its business is organized around Aerospace, Marine Systems, Combat Systems, and Technologies, covering business jets, naval shipbuilding and repair, land combat vehicles, weapons systems, munitions, and mission-critical information technology solutions. The company’s Aerospace segment centers on the Gulfstream family of business aircraft, while Marine Systems focuses on submarine construction and ship repair. Combat Systems produces armored vehicles and related land systems, and Technologies provides communications, cybersecurity, intelligence, and command-and-control capabilities. General Dynamics Corporation plays a significant role in defense procurement, advanced manufacturing, and specialized technology services across the aerospace, maritime, and land domains.
Earnings Schedule
Checked daily · calendar updated Aug 9| Print date | EPS est. | EPS actual | Revenue est. | Revenue actual |
|---|---|---|---|---|
| Jul 29, 2026 | $3.97 | $4.24 +6.8% | — | — |
| Apr 29, 2026 | $3.69 | $4.10 +11.1% | — | — |
| Jan 28, 2026 | $4.12 | $4.17 +1.2% | — | — |
| Oct 24, 2025 | $3.71 | $3.88 +4.6% | — | — |
| Jul 23, 2025 | $3.54 | $3.74 +5.6% | — | — |
Green = beat the estimate, red = missed. An earnings print is the fastest way a thesis changes — our designations should be re-read after each one.
Recent SEC Filings
Last updated: Aug 8, 2026 11:00pm (4h ago)| Filed | Form | Document |
|---|---|---|
| Aug 7, 2026 | 8-K | View |
| Aug 6, 2026 | 4 | View |
| Aug 6, 2026 | 4 | View |
| Aug 5, 2026 | 144 | View |
| Aug 4, 2026 | 4 | View |
| Aug 4, 2026 | 4 | View |
| Aug 4, 2026 | 8-K | View |
| Aug 4, 2026 | 424B5 | View |
| Aug 3, 2026 | 144 | View |
| Jul 31, 2026 | 144 | View |
| Jul 30, 2026 | S-3ASR | View |
| Jul 29, 2026 | 10-Q | View |
Filings link to the SEC’s EDGAR system. Annual/quarterly reports (10-K, 10-Q, 20-F) carry the full story; 8-K/6-K current reports are the fastest signal that something material happened.
Price Overview
Price History (1 Year)
Revenue & Net Income Trend
| Period | Revenue | Net Income | Net Margin | YoY/QoQ |
|---|
Key Metrics
EPS (Diluted): 15.45
Total Equity: $25.62B
Shares: 272,425,000
Total Debt: $8.01B
Cash: $2.33B
EBITDA: $6.28B
Total Debt: $8.01B
Cash: $2.33B
Revenue: $52.55B
Revenue: $52.55B
Revenue: $52.55B
Total Equity: $25.62B
Tax Rate: 17.5%
Equity: $25.62B
Total Debt: $8.01B
Cash: $2.33B
Current Liabilities: $16.80B
Long-Term Debt: $7.01B
Total Debt: $8.01B
Total Equity: $25.62B
Shares: 272,425,000
Shares: 272,425,000
CapEx: -$1.16B
Shares: 272,425,000
Stock Price: $392.05
Net Income: $4.21B
Industry Benchmarks
Income Statement (Annual)
Last updated: Aug 7, 2026 4:58am (1d ago)| Metric | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|
| Revenue | $38.5B | $39.4B | $42.3B | $47.7B | $52.6B |
| Cost of Revenue | — | — | — | — | — |
| Gross Profit | — | — | — | — | — |
| Operating Expenses | — | — | — | — | — |
| Operating Income | $4.2B | $4.2B | $4.2B | $4.8B | $5.4B |
| Net Income | $3.3B | $3.4B | $3.3B | $3.8B | $4.2B |
| EBITDA | $5.1B | $5.1B | $5.1B | $5.7B | $6.3B |
| EPS | $11.61 | $12.31 | $12.14 | $13.81 | $15.65 |
| EPS (Diluted) | $11.55 | $12.19 | $12.02 | $13.63 | $15.45 |
Balance Sheet (Annual)
Last updated: Aug 6, 2026 7:29am (2d ago)| Metric | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|
| Cash & Equivalents | $1.6B | $1.2B | $1.9B | $1.7B | $2.3B |
| Total Current Assets | $20.0B | $21.1B | $23.6B | $24.4B | $24.2B |
| Total Assets | $50.1B | $51.6B | $54.8B | $55.9B | $57.2B |
| Current Liabilities | $14.0B | $15.3B | $16.4B | $17.8B | $16.8B |
| Long-Term Debt | $10.5B | $9.2B | $8.8B | $7.3B | $7.0B |
| Total Liabilities | $32.4B | $33.0B | $33.5B | $33.8B | $31.6B |
| Total Equity | $17.6B | $18.6B | $21.3B | $22.1B | $25.6B |
| Retained Earnings | $35.4B | $37.4B | $39.3B | $41.5B | $44.1B |
Cash Flow (Annual)
Last updated: Aug 7, 2026 4:58am (1d ago)| Metric | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|
| Operating Cash Flow | $4.3B | $4.6B | $4.7B | $4.1B | $5.1B |
| Capital Expenditure | -$887.0M | -$1.1B | -$904.0M | -$916.0M | -$1.2B |
| Free Cash Flow | $3.4B | $3.5B | $3.8B | $3.2B | $4.0B |
| Acquisitions (net) | — | — | — | — | — |
| Net Debt Issued / (Repaid) | $1.5B | -$1.0B | -$1.3B | -$500.0M | -$753.0M |
| Dividends Paid | -$1.3B | -$1.4B | -$1.4B | -$1.5B | -$1.6B |
| Stock Buybacks | -$1.8B | -$1.2B | -$434.0M | -$1.5B | -$637.0M |
| Net Change in Cash | -$1.2B | -$361.0M | $671.0M | -$216.0M | $636.0M |
Growth Trends (YoY %)
Last updated: Aug 7, 2026 4:58am (1d ago)| Metric | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|
| Revenue Growth | +2.4% | +7.3% | +12.9% | +10.1% |
| Gross Profit Growth | — | — | — | — |
| Operating Income Growth | +1.2% | +0.8% | +13.0% | +11.7% |
| Net Income Growth | +4.1% | -2.2% | +14.1% | +11.3% |
| EBITDA Growth | +0.8% | +0.3% | +11.2% | +10.5% |
Dividend History (Last 20)
Last updated: Aug 6, 2026 7:29am (2d ago)| Date | Dividend | Declaration | Record | Payment |
|---|---|---|---|---|
| 2026-07-02 | $1.59 | — | — | — |
| 2026-04-10 | $1.59 | — | — | — |
| 2026-01-16 | $1.50 | — | — | — |
| 2025-10-10 | $1.50 | — | — | — |
| 2025-07-03 | $1.50 | — | — | — |
| 2025-04-11 | $1.50 | — | — | — |
| 2025-01-17 | $1.42 | — | — | — |
| 2024-10-11 | $1.42 | — | — | — |
| 2024-07-05 | $1.42 | — | — | — |
| 2024-04-11 | $1.42 | — | — | — |
| 2024-01-18 | $1.32 | — | — | — |
| 2023-10-05 | $1.32 | — | — | — |
| 2023-07-06 | $1.32 | — | — | — |
| 2023-04-13 | $1.32 | — | — | — |
| 2023-01-19 | $1.26 | — | — | — |
| 2022-10-06 | $1.26 | — | — | — |
| 2022-06-30 | $1.26 | — | — | — |
| 2022-04-07 | $1.26 | — | — | — |
| 2022-01-13 | $1.19 | — | — | — |
| 2021-10-07 | $1.19 | — | — | — |
Insider Trading (Recent)
Last updated: Aug 9, 2026 12:16am (3h ago)All SEC Form 4 codes
- P Purchase
- Open-market or private purchase of shares.
- S Sale
- Open-market or private sale of shares.
- A Award / grant
- Grant or award of securities (RSUs, options, etc.) under Rule 16b-3.
- D Return to issuer
- Securities disposed back to the company under Rule 16b-3.
- F In-kind (tax)
- Shares withheld or delivered to pay the option-exercise price or tax — not an open-market sale.
- I Discretionary
- Discretionary transaction under an employee plan — Rule 16b-3(f).
- M Option exercise
- Exercise or conversion of a derivative (option/RSU) into shares — exempt.
- C Conversion
- Conversion of a derivative security into the underlying shares.
- E Short expiration
- Expiration of a short derivative position.
- H Long expiration
- Expiration or cancellation of a long derivative position with value received.
- O OTM exercise
- Exercise of an out-of-the-money derivative.
- X ITM exercise
- Exercise of an in-the-money or at-the-money derivative.
- G Gift
- Bona fide gift of securities.
- L Small acquisition
- Small acquisition under Rule 16a-6.
- W Inheritance
- Acquisition or disposition by will or the laws of descent.
- Z Voting trust
- Deposit into or withdrawal from a voting trust.
- J Other
- Other acquisition or disposition (explained in a Form 4 footnote).
- K Equity swap
- Transaction in an equity swap or similar instrument.
- U Tender / buyout
- Disposition via tender of shares in a change-of-control transaction.
Compensation-plan codes (A, D, F, M) are routine and rarely directional. Open-market P (buy) and S (sale) carry the most signal.
| Date | Insider | Type | Shares | Price | Value |
|---|---|---|---|---|---|
| 2026-08-03 | NOVAKOVIC PHEBE N | S-Sale | 5,673.00 | $381.17 | $2.2M |
| 2026-08-03 | NOVAKOVIC PHEBE N | S-Sale | 22,707.00 | $382.17 | $8.7M |
| 2026-08-03 | NOVAKOVIC PHEBE N | S-Sale | 15,917.00 | $383.09 | $6.1M |
| 2026-08-03 | NOVAKOVIC PHEBE N | S-Sale | 7,271.00 | $383.85 | $2.8M |
| 2026-07-31 | Gilliland Marguerite Amy | M-OptionExercise | 43,180.00 | $0.00 | $0 |
| 2026-07-31 | Gilliland Marguerite Amy | S-Sale | 16,970.00 | $377.44 | $6.4M |
| 2026-07-31 | Gilliland Marguerite Amy | S-Sale | 26,210.00 | $378.42 | $9.9M |
| 2026-07-31 | NOVAKOVIC PHEBE N | M-OptionExercise | 166,660.00 | $0.00 | $0 |
| 2026-07-31 | NOVAKOVIC PHEBE N | F-InKind | 115,092.00 | $379.17 | $43.6M |
| 2026-06-17 | Malcolm Mark | M-OptionExercise | 2,270.00 | $0.00 | $0 |
| 2026-06-17 | Malcolm Mark | M-OptionExercise | 3,210.00 | $0.00 | $0 |
| 2026-06-17 | Malcolm Mark | S-Sale | 2,270.00 | $365.00 | $828,550 |
| 2026-06-17 | Malcolm Mark | S-Sale | 3,210.00 | $365.00 | $1.2M |
| 2026-06-16 | Stratton John G | A-Award | 104.00 | $359.85 | $37,424 |
| 2026-06-16 | Schumacher Laura J | A-Award | 104.00 | $359.85 | $37,424 |
| 2026-06-16 | Reynolds Catherine B | A-Award | 104.00 | $359.85 | $37,424 |
| 2026-06-16 | Nye C Howard | A-Award | 52.00 | $359.85 | $18,712 |
| 2026-06-16 | Mattis James N | A-Award | 58.00 | $359.85 | $20,871 |
| 2026-06-16 | Hooper Charles W | A-Award | 20.00 | $359.85 | $7,197 |
| 2026-06-16 | HANEY CECIL D | A-Award | 10.00 | $359.85 | $3,599 |
Deep Analysis
Pre-flight intelligence scans the company first, then routes to the right analytical methods.
Narrative Economics
market-narrative step).
Claude Reading
Looking at the raw trajectory first: revenue went from $38.5B (2021) to $52.6B (2025), a 7.9% CAGR — not the 11.5% the momentum table shows (that number is contaminated by pulling from a shorter window). Net income grew from $3.26B to $4.21B, 6.6% CAGR. Q1 2026 revenue of $13.48B vs $12.22B in Q1 2025 is +10.3% YoY, and net margin actually ticked up to 8.3% from 8.1%. But this is a business earning 8% net and 10.2% operating margins — thin for a company trading at 25x earnings and 2.1x sales. ROIC of 14.1% is decent but not exceptional, and it's being compared against a cost of equity that has risen materially. FCF of $3.96B against a $106B market cap is a 3.7% yield — you're paying growth-stock multiples for GDP-plus growth.
The synthesis pegs fair value at ~$319 versus $392, an 18.7% overvaluation. I think that's directionally right but the composite may actually be generous. At a defense-peer-appropriate 18x earnings ($16.60 TTM EPS approximately, backing out the ~$4.2B NI on ~253M shares), you'd get roughly $300. LMT at ~18x and NOC at ~17x are the right anchors — GD's Gulfstream exposure justifies some premium, but Gulfstream is also the most cyclical piece and business jet demand is a coincident indicator of high-end wealth cycles, not a defensive one. The bull case that Aerospace is "counter-cyclical" is historically wrong; Gulfstream orders collapsed in 2008-09 and 2015-16. So paying a premium for that segment during what may be a cycle peak is exactly backwards.
The contrarian argument for staying long here isn't crazy though: submarine backlog through the 2030s (Columbia-class + Virginia Block V/VI) is genuinely locked in, the Marine Systems segment has pricing leverage as the Navy is desperate for boats, and combat systems (European rearmament) has a multi-year tailwind that isn't in the 2021-2025 numbers yet. If you believe European defense spending doubles by 2030 and GD captures its share via Abrams/Piranha/artillery, then 2027-2028 earnings could be $20+ and today's $392 is 19x forward-forward — reasonable. But that's a lot of "ifs" priced in already. The insider activity — six sales clustered on July 31 and August 3, 2026, including large option-exercise-and-sell patterns — is not neutral in my read; it's insiders monetizing at what they perceive as full value. The "neutral" tag from the secondary signals is too charitable when you see this concentration.
I agree with the synthesis verdict but with sharper conviction on the downside asymmetry. Fair value in the $310-330 range, current $392 embeds either (a) a defense supercycle that materializes on schedule, or (b) multiple expansion from here — neither has margin of safety. The narrative layer correctly identifies this as "anchored" with moderate intensity, which is exactly the setup where disappointment causes a re-rating rather than a crash: one missed Gulfstream delivery quarter or one CR-driven Pentagon delay and the stock is $340 quickly. The 1.58% dividend yield doesn't pay you to wait. I'd want $340 or lower to start a position, and I'd note that the FCF CAGR of 2% versus earnings CAGR of ~12% is a quiet red flag — either working capital is consuming cash or capex is running ahead of the P&L, and neither supports paying 25x. Dissent from the models is minor; if anything I'm slightly more bearish than the synthesis's -18.7% gap suggests, because I don't think Gulfstream deserves the premium being ascribed to it.
GPT Reading
The numbers say General Dynamics is a very good business being valued like a great growth business. Operationally, the company is doing almost everything you would want from a mature defense prime: revenue has stepped up from $38.5B in 2021 to $52.6B in 2025, a 36% increase in four years, while operating income rose from $4.16B to $5.36B and net income from $3.26B to $4.21B. Quarterly performance is similarly clean: the last four quarters sum to roughly $52.8B of revenue and about $4.35B of net income, with net margins holding in a tight 7.8%-8.3% band except for a stronger 8.6% quarter at year-end 2024. That consistency matters in defense. But valuation matters too, and at $392, investors are paying about 25.4x earnings, 17.8x EV/EBITDA, 2.0x sales, and only getting a 1.6% dividend yield and roughly a 3.7%-3.9% FCF yield on 2025 free cash flow of $3.96B. For a company with 8% net margins, 10.2% operating margins, and low-double-digit top-line growth that is at least partly cyclical and program-driven, that is rich.
What stands out most is the mismatch between profit growth and cash growth. Earnings CAGR of 12.7% and revenue CAGR of 11.5% look strong, but free cash flow CAGR of just 2% is the more important tell for a contractor/manufacturer with real capital needs. In 2025, operating cash flow was $5.12B and capex was a meaningful $1.16B, leaving $3.96B of FCF; against a $106B market cap, that is not cheap. If this were a software business with expanding margins, maybe 25x earnings would make sense. Here, margins are steady rather than expanding, and that steadiness is a virtue operationally but not a reason to pay a premium multiple. Balance sheet risk is not the issue — net debt is only about $5.7B, debt/equity is 0.31, current ratio is 1.44, ROIC of 14.1% is solid — so this is not a balance-sheet short. It is simply a case where quality and durability have been capitalized too aggressively.
The quarterly pattern also argues against the market paying for accelerating upside. Revenue moved from $11.98B and $11.67B in mid/late 2024 to $12.22B, $13.04B, $12.91B, $14.38B, and $13.48B across the next five quarters; that's healthy growth, but not evidence of a step-function change in earning power. Net income similarly climbed from $905M/$930M to a roughly $1.0B-$1.15B run rate. This looks like a better version of the same company, not a transformed one. At today’s price, the market seems to be underwriting not just dependable defense demand, but a sustained premium multiple despite peer-like margins and only moderate cash conversion improvement. I think that is too generous. On the data given, fair value is materially below the current quote, closer to the low-$300s than to $400.
The best pushback is obvious and respectable: GD may deserve a premium because it has multiple durable franchises, high revenue visibility, and very little financial strain. If you believe the recent growth is not a temporary catch-up but the front end of a multi-year defense and aerospace upcycle, then 2025’s $4.21B of earnings understates normalized power. On that view, the latest quarterly annualized net income run rate of about $4.5B, plus ROE of 16.4% and ROIC of 14.1%, makes the current multiple less extreme. You could also argue that a 25x P/E is less offensive if earnings keep compounding at 10%+ and if Gulfstream or other segments lift mix over time. I weigh that less heavily because the reported margins do not show meaningful operational leverage yet, and the FCF profile still looks like that of an industrial, not a compounding asset-light franchise. The insider tape is not a major red flag given option exercises, but clustered sales near current levels also do not support a heroic upside case.
What would change my mind is evidence that cash flow is about to catch up decisively with earnings and that margins can move structurally higher. If annual free cash flow can move from $3.96B toward $5.0B-$5.5B without balance-sheet stretch, or if operating margin can hold above 11% on revenue north of $55B, the present valuation would look much more defensible. I would also revisit the bear view if upcoming quarters show revenue still growing 9%-10% while net margin expands from the current ~8% band toward 9%, because that would indicate the business is not just stable but gaining quality. Absent that, the current price already discounts the good news.
Grok Reading
grok-critique step) alongside the other Big-3 seats, when a
report is run on this ticker.
Big-3 Panel — where each AI stands
Advanced Analysis Forensic deep-dive · three lenses
GD is a mature aerospace and defense earner running with predictable execution: revenue has climbed from $38.5B (2021) to $52.6B (2025), a ~8% CAGR, while operating margin held tight in a 10.0-10.8% band and net income grew from $3.26B to $4.21B. Free cash flow of $3.96B in 2025 slightly exceeds net income, and OCF/NI of 1.28x with accruals at -1.8% of assets points to high earnings integrity — reported profits are cash-backed. Altman Z of 4.47 puts the balance sheet in the safe zone despite $5.68B net debt, which is easily serviced by ~$4B of annual FCF.
Verify before trusting this (5)
- Segment mix and backlog trajectory (Aerospace/Gulfstream vs. Combat Systems, Marine, Technologies) to gauge revenue durability
- Program concentration risk (Columbia-class submarine, Abrams, Gulfstream G700/G800 ramp)
- Working capital / contract asset movements explaining the 2024 FCF dip
- Pension and OPEB obligations behind the net debt figure
- Whether recent CEO/insider sales are 10b5-1 scheduled dispositions
The e2e synthesis pegs composite fair value at $316.09 and signal-adjusted at $318.75 against a $392.05 price - about a 19% overpayment. The DCF ($329.86) and EPV floor ($189.98) both sit well below spot; only the anchored-PE ($414.67) supports today's tape, and that method is essentially saying 'the market's multiple is the right multiple,' which is circular when we are judging whether the market is right. Strip that out and the honest deserved range is roughly $260-$330.
Verify before trusting this (4)
- Marine Systems (submarine) backlog conversion and margin trajectory in next 10-Q
- Gulfstream G700/G800 delivery cadence and aerospace margin recovery
- FY guidance vs analyst consensus - any tempering would puncture the priced-for-perfection setup
- Buyback pace and net debt trend given elevated capex
Sentiment pressure on GD is modestly positive but muted by its own low-beta character. The macro tape is risk-on with VIX at 14.9 and the S&P near highs, but with beta 0.33 that tailwind barely grazes this name - GD does not rip on risk appetite the way high-beta stories do. What actually matters here is the narrative flow, and it is running the right way: a durable steady-compounder story reinforced this week by a Q2 beat across all four segments, a raised guide, a record $136.5B backlog, and a $1.3B GDIT cyber award. That is exactly the kind of drumbeat that hardens a defense-compounder narrative rather than sparking euphoria. Offsetting that, the 7/29 tape reaction was telling - beat, raise, and a record $76.6B submarine award, and the stock still fell. That suggests good news is largely priced and analyst tone is closer to 'fairly valued' than chasing (one write-up frames it as only ~5% undervalued after the beat). Political noise around defense budgets is a low-grade overhang but not acute. Net: a real but ordinary tailwind, not a dominant force.
Verify before trusting this (4)
- Whether sell-side raises price targets meaningfully after the Q2 beat or holds pat (tone divergence)
- Any FY27 defense budget headlines that could crack the peer-competition narrative
- Follow-through in share price on the GDIT/ENOCS award and next submarine milestone
- Sector rotation signals - defense primes relative to broader industrials
Character & Durability Scorecard
Survivability 9/10
Defense primes with diversified government contracts have proven highly recession-resistant, and GD maintained profitability and positive FCF through COVID and prior downturns with minimal revenue volatility.
- Defense prime contractor with multi-decade track record through multiple recessions including 2008-09 and 2020
- Altman Z-score 4.47 indicates safe financial health with consistent FCF generation through cycles
Adaptability 7/10
GD has demonstrated ability to navigate major defense budget cycles and technology shifts, though pace of change is measured rather than rapid given long procurement cycles.
- Successfully navigated post-Cold War defense downturn and pivoted portfolio through Gulfstream acquisition
- Adapted to shift from heavy ground vehicles to technology-intensive platforms and cybersecurity
Moat Trajectory 8/10
Defense prime moat remains durable and arguably widening as complexity increases, though competitive set is stable rather than shrinking.
- Oligopoly structure in defense with high barriers to entry from security clearances and decades-long platform relationships
- Strengthening switching costs as platforms become more integrated and software-intensive
Capital Allocation 8/10
Consistent share repurchases funded by strong cash generation with disciplined M&A focused on adjacent capabilities rather than empire-building.
- Buyback/SBC ratio of 661.5% indicates disciplined capital return
- Share count reduced 0.9% annually while generating strong FCF averaging $3.56B over five years
Pricing Power 7/10
Contract structures and competitive position provide solid pricing power, though margins are constrained by negotiated government contracts rather than fully market-driven.
- Operating margin stable 10-10.8% despite revenue growth from $38.5B to $52.6B over 2021-2025
- Cost-plus and fixed-price contracts with escalation clauses provide some inflation protection
Management Alignment 6/10
Low SBC is positive but meaningful insider selling without offsetting purchases and lack of detailed ownership data suggests adequate but not exceptional alignment.
- Insider selling of $81M with zero buys over 12 months shows mixed alignment
- SBC at only 0.4% of revenue indicates reasonable compensation structure
Demand Durability 9/10
Strong secular tailwinds from elevated threat environment and sustained defense budget growth across Western allies create durable multi-year demand.
- Global defense spending accelerating due to geopolitical tensions including Ukraine, Taiwan, and NATO rearmament
- Bipartisan US political support for defense spending with multi-year budget visibility
Growth Consistency 8/10
Consistent upward trajectory in both revenue and earnings with low volatility demonstrates reliable compounding execution.
- Revenue grew steadily from $38.5B (2021) to $52.6B (2025), a 36.5% cumulative increase with no down years
- Net income rose from $3.26B to $4.21B over same period despite one modest dip in 2023
Optionality / Runway 7/10
Clear growth runway from technology adjacencies and international expansion, though constrained by deliberate procurement cycles and competitive dynamics.
- Expansion opportunities in hypersonics, autonomous systems, and cybersecurity within existing customer base
- International defense spending runway as allies modernize and increase budgets
Concentration / Key-Person Risk 6/10
Product and segment diversification is strong, but heavy reliance on US government budgets creates meaningful customer concentration risk despite diversified leadership.
- Diversified across four major segments (Aerospace, Marine, Combat, Technologies) with different end customers
- US government represents majority of revenue creating customer concentration despite program diversity