GD - LOCK N LOAD. More war weapons earnings comin this week!

Really wanted to get to this earlier today but life got in the way. Still wanted to get at least something up before market open tomorrow.

General dynamics, a global aerospace and defense company, is the fifth largest defense contractor in the world by arms sales, and the 5th largest in the United States by total sales.

General dynamics is most known today for owning Gulfstream Business Jets, building Virginia and Columbia class nuclear powered submarines, Arleigh Burke class guided missile destroyers, M1 Abrams tanks, and Stryker armored fighting vehicles.

Last quarter earnings they received an EPS of $2.75 (beat by $0.03)

This quarter earnings is Wednesday 10/26, pre market and analysts are expecting an EPS of $3.16.

Current closing price on Friday was $242.60. GD currently has an average PT from analysts around $260.

I plan on playing this at some point for earnings. After last weeks massive run up of just about everything, id like to see a little bit of a pullback possibly before taking a position.

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I was looking at them as well, but their last ER transcript raised a few questions. Seems like a lot of benefit of war has been priced in.

LMT moved massively due to the huge share buy back. GD will probably do well but a lot of benefit will start coming in 2023. Saying that I will probably get some calls on Tuesday as well.

I’m in. 3 - Friday 250c @ 2.00

The global aerospace and defense company said net income rose to $902 million, or $3.26 a share, compared with $860 million, or $3.07 a share, a year earlier.

Revenue rose 4.3%, to $9.98 billion. Analysts polled by FactSet had been expecting revenue of $9.92 billion.

Orders remained strong across the company with a consolidated book-to-bill ratio, General Dynamics said, noting that backlog from its aerospace unit grew to $19.1 billion in the quarter.

"Our businesses delivered solid operating performance and cash flow even as they managed through the challenges of inflation and supply chain constraints, Chairman and Chief Executive Phebe N. Novakovic said on the group’s free cash flow of $1 billion in the period.

Well it looks like Defense stocks (mostly LMT) have been moving up quite a bit this week. But then so has the rest of the market. GD has been moving in very close relation with spy.

Since earnings:

Royal bank of Canada raised their price target on GD from 270 to 275
Wolfe Research raised their pt from 260 to 265
Credit Suisse raised theirs from 238 to 243

Awarded a $123m navy contract, then another $19.1 million modification contract on top of that.

Ended up averaging down quite a bit on my calls after earnings. Price went up, IV went down. IV decided to start moving back up today and sold the 7 contracts I bought (average 1.26) for $2.00.

With all the DD regarding the rest of the market that I’ve been reading on here, along with all the TF Chat DD from all of you it made me feel a bit confident that this play would end up working out, so thank you all.


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