General Dynamics Corp (GD) shares plummeted 5.93% in pre-market trading on Wednesday, underperforming the broader market. The defense contractor's stock took a hit as investors digested its latest earnings report showing a decline in new orders backlog, coupled with caution ahead of the Federal Reserve's interest rate decision later in the day.
According to the company's fourth-quarter earnings release, General Dynamics posted a consolidated book-to-bill ratio of 0.9-to-1 for the quarter, indicating that new orders fell slightly short of revenue. While its total backlog stood at $90.6 billion by the end of 2024, up 9.1% year-over-year, the figure fell short of some analysts' expectations, raising concerns about future growth prospects.
Moreover, the broader market sentiment was cautious ahead of the Fed's highly anticipated policy meeting. Investors are bracing for potential volatility as the central bank weighs the impact of its aggressive monetary tightening on the economy and provides guidance on its future rate path.
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