Jefferies Sees Continued Growth for General Dynamics’ (GD) Marine Business

With a free cash flow yield of 6.30%, General Dynamics Corporation (NYSE:GD) is included among the 12 Stocks From Companies Generating High Cash Flow.

On June 11, Jefferies analyst Sheila Kahyaoglu upgraded General Dynamics Corporation (NYSE:GD) to Buy from Hold and raised the price target to $400 from $380. In a research note, the analyst said the company’s marine segment, which accounts for 33% of sales, has posted double-digit growth in 11 of the past 13 quarters. Jefferies noted that the U.S. Navy’s shipbuilding plan includes $125 billion in submarine procurement from fiscal 2027 through 2031, along with $6.2 billion for the submarine industrial base and $7.2 billion for submarine productivity. The firm now expects continued strength in General Dynamics’ near-term results, with the marine business supporting margin expansion.

Earlier, on May 18, Citi lowered its price recommendation on GD to $364 from $380. It reiterated a Neutral rating on the shares. The firm updated its aerospace and defense sector models and said it does not expect an “immediate V-shaped rally” without a resolution to the Middle East conflict. Citi still sees buying opportunities following the recent selloff and expects aerospace stocks to recover first, with defense names following later.

General Dynamics Corporation (NYSE:GD) is a global aerospace and defense company. It provides products and services across business aviation, ship construction and repair, land combat vehicles, weapons systems and munitions, and technology products and services.

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