General Dynamics (NYSE: GD) turned in a quarterly profit that beat expectations. The business of battle overshadowed aviation industry contraction, which contributed to the result. Thanks to the strong Q3, General Dynamics has raised its profit forecast for the year.
JPMorgan analyst Joseph Nadol wrote to his clients this morning that "the stock has been strong recently" and "there is no denying that the company posted good results." But, he also observed that the near-term upside is limited, because investors expected a solid Q3, and the company still faces some pressure from a pretty sharp drop in its aerospace backlog.
Revenue was up 8% to $7.7 billion for the quarter, with net earnings of $572 million ($1.47 a share) down 10% from last year's $634 million ($1.59 a share). Analysts expected an average earnings result of $1.40 per share.
The Gulfstream Aerospace unit put a drag on the aviation division, which saw revenues fall 18% and profits plunge 56% year-over-year. General Dynamics' three defense businesses, on the other hand, delivered both revenue and earnings increases -- thanks in large part to increased demand for armored vehicles and ammunition.
General Dynamics has upped its full-year profit from continuing operations to $6.15 to $6.20 a share, rather than the $6.05 to $6.15 it put forth in July.
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