General Dynamics Corporation (GD) — Fundamental Analysis & Key Financial Ratios

Kaplio's reading: General Dynamics Corporation

Updated on October 31, 2026 · accounts published on October 30, 2026

A growing industrial that turns its profit into cash, with margins a little below its own history

General Dynamics trades at a P/E of 21.9 over the last 12 months, 11 % above its ten-year median and 15 % below its sector median.

• Is General Dynamics expensive or cheap? At a P/E of 21.9, General Dynamics is 11 % above its ten-year median but 15 % below its sector median.
• How is the business doing? Revenue grew 10 % and EPS 13 % over the last 12 months, though the 10.4 % operating margin trails its 11.5 % long-run average.
• How strong is the balance sheet? Net debt was $28.79 per share in fiscal 2025, just 7.7 % of the share price, and the dividend has risen for 11 straight years.
• What to expect from the next earnings? Analysts expect EPS of $4.51 for the report due January 27, 2027, after eight straight quarterly beats.
• Does it turn its margin into cash, and at what multiple of the cycle does it trade? Free cash flow was 94 % of net income in fiscal 2025, above the 85 % an industrial needs to count as healthy.

Is General Dynamics expensive or cheap?

Over the last 12 months General Dynamics trades at a P/E of 21.9, against a ten-year median of 19.8 and a sector median of 25.8 across 297 companies. The stock has traded at a lower P/E 71 % of the time over the last decade, so on its own history it sits in the upper part of the range, though well short of the decade high of 27.2. EV/EBITDA of 15.3 over the last 12 months is above its seven-year average of 13.7. The free cash flow yield of 6.5 % softens the picture: the premium is against its own past, while it still trades at a discount to its peers.

How is the business doing?

Over the last 12 months revenue rose 10 % and EPS 13 %, and revenue per share has compounded at 8.1 % a year over fiscal 2020-2025, above the 6 % that counts as healthy for an industrial. Profitability is steady rather than outstanding. The operating margin of 10.4 % over the last 12 months sits below the 11.5 % average of fiscal 2014-2025, and ROIC of 11.3 % beats the sector median of 9.1 % by 2.3 points. ROIC has stayed above 10 % in six of the last ten fiscal years, with a low of 9.0 % in 2023: a record of consistency more than brilliance.

How strong is the balance sheet?

The balance sheet carries little strain. Debt to equity is 0.33 over the last 12 months and net debt was 1.2× EBITDA in fiscal 2025, well under the 3.0× ceiling considered healthy for industrials. The Altman Z score of 4.2 sits in the safe zone above 2.99, and a Piotroski score of 8 out of 9 points to fundamentals that are improving across the board. Shareholders receive a 1.7 % dividend yield over the last 12 months, raised for 11 consecutive fiscal years through 2025, with a payout of 38 % of earnings in fiscal 2025 that leaves ample headroom.

What to expect from the next earnings?

On October 30, 2026 General Dynamics reported EPS of $4.49 against $4.12 expected, a 9 % beat, and it has topped EPS estimates in each of the last eight quarters. For the next report, on January 27, 2027, analysts expect $4.51, barely above the quarter just delivered. The 2026 EPS consensus has hardly moved in 30 days, from $17.00 to $17.02 across 15 analysts, and revenue estimates are equally steady. Of the 35 analysts covering the company, 20 recommend buying, 14 holding and one selling. The bar looks modest, and the streak of beats is what the next report will test.

Does it turn its margin into cash, and at what multiple of the cycle does it trade?

Industrials are semi-cyclical and live on order backlogs, so a year's profit only proves itself when it becomes cash, and multiples are best read against a full cycle rather than a single year. General Dynamics converted 94 % of fiscal 2025 net income into free cash flow, comfortably above the 85 % threshold. The weaker spots are the 10.2 % operating margin in fiscal 2025, under the 12 % healthy mark, and capex of 2.2 % of revenue, below the 4-8 % range considered healthy. On the cycle, EV/EBITDA of 15.3 over the last 12 months sits above its seven-year average of 13.7.

How this was prepared: the data comes from companies' official filings, collected by a professional provider, and from Kaplio's analysis engine (trailing-12-month ratios, 10 years of history and sector medians computed across US-listed companies). The text is written from that data alone, every figure is checked against it before publication, and it is reviewed when the company reports results. This is not investment advice.