Yahoo Finance Solid Sales Performance to Aid General Dynamics (GD) Q4 Earnings
General Dynamics Corporation GD is set to release fourth-quarter and full-year 2022 results on Jan 25, before market open.
General Dynamics delivered an earnings surprise of 2.42% in the last four quarters, on average. The strong growth in revenues across most of its business segments is likely to positively impact its fourth-quarter results.
Aerospace Unit to Boost the Overall Top Line
Steadily recovering global air travel demand is likely to have contributed to General Dynamics’ Aerospace business unit sales performance, mainly due to the increased demand for maintenance work and activity at its fixed-base operator facilities. Improved aircraft deliveries may also have added impetus to its third-quarter revenues.
The Zacks Consensus Estimate for the Aerospace segment’s revenues in the fourth quarter is pegged at $2,620 million, indicating a 2.3% improvement from revenues reported in the year-ago quarter.
General Dynamics Corporation Price and EPS Surprise
General Dynamics Corporation price-eps-surprise | General Dynamics Corporation Quote
Marine Systems to Contribute Unfavorably
Marine Systems’ Q4 revenues are likely to have been positively impacted by construction and repair volume for ships. However, insufficient lead yard services for submarine programs might have had some adverse impact on this segment’s overall performance in the soon-to-be-reported quarter.
The Zacks Consensus Estimate for the Marine segment’s revenues in the fourth quarter is pegged at $2,804 million, indicating a 2.3% decrease from revenues reported in the year-ago quarter.
Positive Combat Systems Sales
Increased revenues from Stryker wheeled combat vehicles and Abrams battle tanks are expected to have contributed to the fourth-quarter revenues of Combat Systems.
The Zacks Consensus Estimate for the Combat Systems segment’s revenues in the fourth quarter is pegged at $1,934 million, indicating a 2.5% improvement from revenues reported in the year-ago quarter.
Technologies Unit Revenues
Strong order activity and a pipeline, buoyed by the government's initiative to continue to modernize and upgrade mission support systems, are likely to have benefited the Technologies segment’s sales performance in the soon-to-be-reported quarter.
However, consistent supply-chain shortages might have had some adverse impact on the overall performance of this segment.
The Zacks Consensus Estimate for the Technologies segment’s revenues in the fourth quarter is pegged at $3,372 million, indicating 13.3% growth from revenues reported in the year-ago quarter.
Other Factors to Note
The impressive sales performance across all its segments makes us optimistic about GD’s overall top line in the third quarter. This, in turn, is likely to have aided the bottom line of the company in the soon-to-be-reported quarter.
However, headwinds like shortage of chips, inflation, labor shortage and customer contracting delays may have partially impacted its overall results.
Q4 Estimates
The Zacks Consensus Estimate for General Dynamics’ fourth-quarter revenues is pegged at $10.73 billion, suggesting growth of 4.3% from the year-ago quarter.
The Zacks Consensus Estimate for General Dynamics’ fourth-quarter earnings is pegged at $3.16 per share, indicating growth of 4.7% from the prior-year reported figure.
What the Zacks Model Unveils
Our proven model does not conclusively predict an earnings beat for General Dynamics this time. This is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for an earnings beat. However, that is not the case here as given below.
General Dynamics has an Earnings ESP of 0.00% and a Zacks Rank #3. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Stocks to Consider
Below are three defense stocks that have the right combination for an earnings beat:
Spirit AeroSystems SPR: It is scheduled to release its fourth-quarter results soon. SPR has an Earnings ESP of +93.75% and a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.
SPR delivered a four-quarter average negative earnings surprise of 73.24%. The Zacks Consensus Estimate for Spirit AeroSystem’s fourth-quarter bottom line is pegged at a loss of 48 cents per share, which implies a solid improvement from a loss of 84 cents incurred in the fourth quarter of 2021.
Leidos Holdings LDOS: It is scheduled to release its fourth-quarter results on Feb 14. LDOS has an Earnings ESP of +1.19% and a Zacks Rank #3.
LDOS delivered a four-quarter average earnings surprise of 2.01%. The Zacks Consensus Estimate for Leidos’ fourth-quarter earnings, pegged at $1.61 per share, suggests an improvement of 3.2% from the fourth quarter of 2021.
Airbus Group EADSY is slated to report its fourth-quarter results soon. EADSY has an Earnings ESP of +6.25% and a Zacks Rank #2.
EADSY delivered a four-quarter average earnings surprise of 59.88%. The Zacks Consensus Estimate for EADSY’s fourth-quarter earnings, pegged at 48 cents per share, implies a decline of 15.8% from the fourth quarter of 2021.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.
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General Dynamics Corporation (GD) : Free Stock Analysis Report
Spirit Aerosystems Holdings, Inc. (SPR) : Free Stock Analysis Report
Airbus Group (EADSY) : Free Stock Analysis Report
Leidos Holdings, Inc. (LDOS) : Free Stock Analysis Report
