General Dynamics Corporate Profile

In terms of the major defense companies in America, it’s probably safe to say that General Dynamics (NYSE:GD) is one that flies under the radar. General Dynamics is one of the oldest defense contractors as it was established in 1899 and is based out of Reston, Virginia, not too far from the headquarters of industry rival Northrop Grumman (NYSE:NOC). General Dynamics is a component of both the S&P 500 and S&P 100 indices, and currently has a market capitalization of just over $60 billion.

In terms of its business, General Dynamics’ most famous product is the Gulfstream private jets that are used by the wealthy to travel in style. In addition to this, General Dynamics manufactures several models of military tanks including the Abrams Tank and Stryker combat vehicle. It also produces a long list of different munitions and missile systems for the United States Armed Forces and its allies.

General Dynamics also has three subsidiaries that deliver leading naval ships. These include Bath Iron Works which manufactures the Arleigh Burke and Zumwalt-class vessels, Electric Boat which makes nuclear-powered submarines, and NASSCO which produces oil tankers and other dry cargo carriers. Finally, like with many defense companies, General Dynamics is evolving its products and services to meet the needs of the next generation of warfare. This means it is strengthening its information technology networks for militaries as well as its cyber communication and detection systems.

General Dynamics Dividend history

Compared to its peers like Raytheon Technologies (NYSE:RTX) and Lockheed Martin (NYSE:LMT), General Dynamics has one advantage: longevity. The stock is officially a dividend aristocrat and raised its dividend in 2021 for the 28th consecutive year. Currently, the stock has a dividend yield of 2.29% on an annualized basis, which is above the average yield of the Dow Jones S&P 500 indices.

Last quarter, General Dynamics saw $435 million in free cash flow, much of which was paid out to shareholders via dividends. Once a stock reaches the level of a dividend aristocrat, it is highly likely that the company will continue to pay these out for years to come. This speaks to the strength of the industry and business of General Dynamics, and makes it one of the most compelling defense stocks to add to any diversified portfolio.

Is General Dynamics a Good Investment?

General Dynamics is not a company that receives a lot of headlines, but it has quietly created a strong industry moat and created a lucrative cash flow stream. This has allowed General Dynamics to raise its dividend for 28 consecutive years earning it a spot on the exclusive dividend aristocrats list. General Dynamics has a bit more of a diversified portfolio than its peers. With the strong military portfolio combined with the Gulfstream private jets, General Dynamics has a diversified list of products and services it provides to both militaries and consumers. An argument can be made that General Dynamics is one of the strongest defense stocks to own right now.

This article was written by roged01