Al Root

Defense contractors and private jet maker General Dynamics turned in solid quarterly results. The stock isn't moving much yet. Investors are waiting for the outlook.

Wednesday morning, General Dynamics reported fourth-quarter earnings per share of $4.15 from $13.3 billion in sales. Wall Street was looking for $4.07 and $12.8 billion, respectively, according to FactSet.

Earnings per share for the full year were $13.63, up from $12.02 in 2023. Sales totaled $47.4 billion, up about 13% year over year.

Numbers look solid. General Dynamics stock was down 0.8% in premarket trading at $260.51, while S&P 500 and Dow Jones Industrial Average futures are down slightly.

Investors are probably waiting for guidance coming on management's earnings conference call that starts at 9 a.m.

A year ago, General Dynamics projected aerospace revenue of $12 billion, and operating-profit margins of 15%. Aerospace sales came in at $11.2 billion, missing guidance, but still rising 30% year over year. Operating-profit margins were about 13%, down from 13.7% in 2023.

The rest of the business, including General Dynamics' defense operations, picked up the slack. Total company revenue was expected to be about $$46.3 billion. General Dynamics ended up beating that by about $1.4 billion.

Combat system sales grew 9% year over year, hitting $9 billion. Operating profit margins came in at 14.2%, up from 13.9% in 2023.

Looking ahead, Wall Street wants more growth. Sales in 2025 are projected to be about $50.3 billion. Earnings per share are forecast to be $15.84.

Coming into Wednesday trading, shares were down about 1% over the past 12 months, trailing the S&P 500 by about 24 percentage points.

The outlook for defense spending and aerospace growth has weighed on investor sentiment. Those are areas management should address on the coming call.

Write to Al Root at allen.root@dowjones.com

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(END) Dow Jones Newswires

January 29, 2025 09:38 ET (14:38 GMT)

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