UBS Sees Improving Demand Across General Dynamics’ (GD) Core Businesses

Core Insights - General Dynamics Corporation (NYSE:GD) is recognized among the Dividend Growth Stocks: 25 Aristocrats [1] - UBS raised its price target for General Dynamics to $393 from $388 while maintaining a Neutral rating, citing improving demand across most business segments [2] - The company reported fourth-quarter profit and revenue exceeding estimates, driven by strong performance in combat and marine systems, but provided a full-year profit outlook below Wall Street expectations [3] Business Performance - The Marine Systems segment is recovering from previous supply chain issues and labor shortages, with improved productivity noted during the quarter [5] - The Combat Systems segment is experiencing increased international demand, particularly in Europe, due to ongoing geopolitical tensions, leading to higher sales of vehicles, weapons, and munitions [5] - Quarterly bookings for General Dynamics are strong, running at 1.6 times billings, indicating a robust backlog [5] Financial Outlook - Management expects annual earnings of $16.10 to $16.20 per share, which is below the consensus estimate of $17.29 per share [3] - The impact of U.S. tariffs in 2026 is anticipated to exceed the $41 million recorded in 2025, with these costs already factored into the company's margin outlook [4]