General Dynamics (GD) has kicked off its latest reporting cycle with recent quarterly numbers that show total revenue moving from US$11.7 billion in Q3 2024 to US$14.4 billion in Q4 2025, while basic EPS over that stretch ranged between US$3.39 and US$4.23 per share. Over the same period, trailing twelve month revenue shifted from US$47.7 billion to US$52.6 billion and trailing EPS moved from US$13.81 to US$15.65. This gives investors a clear view of how top line scale and per share earnings have been tracking together. With net profit margins sitting at 8% and earnings growth over the last year ahead of the longer term pace, the latest results present a picture of disciplined profitability that will be central to how the market reads this update.

See our full analysis for General Dynamics.

With the headline figures set, the next step is to see how these earnings line up against the big narratives around General Dynamics, from its growth profile to its perceived quality as a long term compounder.

8% net margin backed by TTM earnings of US$4.2b

• Over the last 12 months, General Dynamics generated about US$52.6b in revenue and US$4.2b in net income, which works out to an 8% net profit margin compared with 7.9% a year earlier.
• The analysts' consensus view that margin improvement can stick is being tested against the actual numbers. Trailing EPS of US$15.65 is above the 5 year earnings growth pace of 5.7% per year, while net margin has held at 8% even with revenue growth of about 4% per year, which is slower than the broader US market.
  • Supporters of the consensus narrative point to the combination of record backlog and this 8% margin as a sign that Marine, Aerospace and technology focused programs are helping earnings grow faster than sales, with trailing earnings up 11.3% over the past year.
  • The tension is that consensus also expects revenue to grow at roughly 4% per year and earnings at about 7% per year. The current 11.3% earnings growth rate and 8% margin would therefore need to be maintained or managed carefully if those expectations are to be met over time.

P/E of 21.8x and DCF fair value of about US$399.61

• The shares trade on a P/E of 21.8x, which is below the peer average of 38.4x and the broader industry at 35.5x, while a DCF fair value estimate of about US$399.61 sits above the current share price of US$338.73.
• Consensus narrative supporters see valuation as a key part of the story, and the current data gives them some concrete points to work with and some pushback to think about.
  • On one hand, the lower P/E versus peers and an indicated gap of roughly US$60 between the DCF fair value of US$399.61 and the market price of US$338.73 both line up with the idea that investors are not paying as much for each dollar of earnings as they are for similar companies.
  • On the other hand, forecasts calling for about 4% annual revenue growth and roughly 7% annual earnings growth explain why some investors may be comfortable paying a lower multiple despite the record backlog and analysts' price target of US$395.31 sitting above where the stock trades today.

5.7% multi year EPS growth with a 1.77% dividend yield

• Earnings have grown about 5.7% per year over the past five years, with a stronger 11.3% growth rate over the last year, and shareholders collected a 1.77% dividend yield over the trailing 12 months alongside limited insider selling activity.
• Supporters of the consensus narrative highlight this mix of growth and income, and the recent results give a few angles to weigh up before considering how durable that mix looks.
  • The combination of a 5.7% multi year earnings growth rate, a faster 11.3% trailing year pace, and an 8% net margin suggests the business has produced steady profitability while also returning some cash through a 1.77% dividend yield.
  • At the same time, forecasts for earnings to grow around 7% per year and revenue at about 4% per year point to a more moderate path than the latest 12 month figures alone might imply. This is one reason some investors may focus on the reliability of the dividend and the balance of growth versus income rather than expecting rapid acceleration.

Next Steps

To see how these results tie into long-term growth, risks, and valuation, check out the full range of community narratives for General Dynamics on Simply Wall St. Add the company to your watchlist or portfolio so you'll be alerted when the story evolves.

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See What Else Is Out There

General Dynamics pairs an 8% net margin and 1.77% dividend yield with moderate multi year earnings growth and revenue expansion that trails the broader US market.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.