Earnings Preview: What to Expect From General Dynamics’ Report

General Dynamics Corporation (GD), headquartered in Reston, Virginia, operates as a global aerospace and defense company. Valued at $89.3 billion by market cap, the company offers a broad portfolio of products and services in business aviation, combat vehicles, weapons systems, munitions, shipbuilding design and construction, information systems, and technologies. The defense giant is expected to announce its fiscal third-quarter earnings for 2026 in the near future.

Ahead of the event, analysts expect General Dynamics to report a profit of $4.14 per share on a diluted basis, up 6.7% from $3.88 per share in the year-ago quarter. The company has consistently surpassed Wall Street’s EPS estimates in its last four quarterly reports.

For the full year, analysts expect General Dynamics to report EPS of $16.99, up 9.9% from $15.46 in fiscal 2025. Its EPS is expected to rise 9.5% year over year to $18.61 in fiscal 2027. 

GD stock has underperformed the S&P 500 Index’s ($SPX) 15.8% gains over the past 52 weeks, with shares down 3.5% during this period. Similarly, it underperformed the State Street Industrial Select Sector SPDR ETF’s (XLI) 10.2% gains over the same time frame.

GD has underperformed primarily due to valuation multiple compression and investor skepticism regarding profit conversion, despite achieving record total backlogs exceeding $136 billion. While top-line revenue expanded through strong order flow, particularly in its Aerospace (Gulfstream) and Marine Systems divisions, the stock faced headwinds after earnings updates where full-year EPS guidance implied limited margin acceleration in the second half of the year. Furthermore, sentiment was weighed down by supply-chain bottlenecks slowing production delivery timelines, localized operational challenges in defense manufacturing units, and significant executive insider share sales following earnings releases, prompting investors to re-evaluate the stock's elevated valuation relative to pure-play defense peers. 

Analysts’ consensus opinion on GD stock is reasonably bullish, with a “Moderate Buy” rating overall. Out of 24 analysts covering the stock, 13 advise a “Strong Buy” rating, 10 give a “Hold,” and one recommends a “Strong Sell.” GD’s average analyst price target is $418.50, indicating a potential upside of 26.2% from the current levels.