General Dynamics Posts Strong Earnings Ahead of UAW Contract Vote. Stock Rises.

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Investors are waiting to see if employees represented by the United Auto Workers ratified a new labor deal.

Aerospace and Defense giant General Dynamics reported solid financial results amid rising global turmoil. Shares are steady after a recent run higher.Wall Street was looking for $2.91 a share from sales of $10 billion. A year ago in the third quarter of 2022, General Dynamics reported EPS of $3.26 from sales of just under $10 billion.

“We continue to see strong demand and steady revenue growth across the business, resulting in significant growth in backlog,” said CEO Phebe Novakovic in a news release. “Both operating earnings and net earnings increased over last quarter, and cash from operations was a highlight.”Business backlog was also a highlight, setting a record at almost $96 billion.

General Dynamics shares were up 0.2% in early trading just after results were released. S&P 500 futures were down about 0.3%. Dow Jones Industrial Average futures were up 0.2%. Shares are up about 6% since Oct. 6, the Friday before Hamas terrorists attacked Israel. That event sent shares of all defense stocks higher.Along with earnings review and business update, investors are waiting to see if employees represented by the United Auto Workers ratified a new labor deal agreed to by the company and union negotiators. The tentative agreement includes wage increases totaling about 14% over four years. Inflation protection is also a feature of the new deal.

Coming into Wednesday trading, General Dynamics shares were down about 5% over the past 12 months. Before the recent rise in global conflict, U.S. government deficits and shutdowns were weighing on investor sentiment toward defense stocks.

 

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General Dynamics stock set to snap longest losing streak in 4 years after earnings beat expectationsTomi Kilgore is MarketWatch's deputy investing and corporate news editor and is based in New York. You can follow him on Twitter TomiKilgore.
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