Key Points
- General Dynamics is a right-place, right-time defense-sector competitor for the 2020s.
- Investors can confidently buy and hold General Dynamics stock for its fair value and respectable yield.
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Division, conflict, and uncertainty in the world can make you pessimistic, or it can point you to powerful wealth-building opportunities. If you’re bullish about the defense industry through the year 2030 and beyond, you’ll definitely want to take a look atGeneral Dynamics(NYSE:GD).
As we’ll discover today, General Dynamics stock is a solid and reasonably priced dividend stock that distributes payments every quarter. Instead of chasing the highest yield, we’re picking an underappreciated competitor with the potential to dominate in the coming years.
Flying Under the Radar
I would propose that, due to constant international frictions, the U.S. defense industry will remain top-of-mind for many years to come. If you truly want to choose a dominant dividend stock that you can hold for the long haul, consider focusing on the aerospace/defense sector.
Research and Markets predicts that the U.S. aerospace market will expand at a compound annual growth rate (CAGR) of 2.4% from 2025 to 2034. Furthermore, the research firm identified General Dynamics as a leading manufacturer in the aerospace industry, noting that it “[d]elivers vital solutions across multiple domains.”
Truly, General Dynamics is in the right market at the right time. Believe it or not, Research and Markets envisions the military deployable infrastructure market growing to $1.29 billion in 2029 at a CAGR of 6.3%.
In addition, Markets and Markets expects the the space militarization market to reach $88.6 billion by 2030 at a CAGR of 7.4% from 2023 to 2030. So clearly, if you’re picking growth stocks to hold through the year 2030, you should go shopping in the aerospace/defense sector.
Granted, General Dynamics isn’t quite as famous as its main competitors, which are Boeing(NYSE:BA), Lockheed Martin(NYSE:LMT), and Raytheon Technologies(NYSE:RTX) (also known as RTX Corp.). Yet, the comparative under-the-radar status of General Dynamics is what makes it appealing. If this company evolves from a competitor to a leader in the field, GD stock could mint some new millionaires in a few years’ time.
General Dynamics: Finding the Financial Facts
General Dynamics stock pays a good dividend, and we’ll get to the specifics of that in a moment. First, however, we need to make sure that the company can afford to continue paying dividends.
It’s certainly a positive sign that General Dynamics business unit General Dynamics Information Technology (GDIT) scored a U.S. government contract in May. It’s an enterprise information technology (IT) modernization contract valued at $1.5 billion, so that ought to keep General Dynamics flush with cash for a while.
Next, we’ll take a peek at General Dynamics’ financial results for the quarter ended June 29, 2025. The company’s revenue totaled $25.264 billion, indicating 11.3% growth when compared to $22.707 billion in the year-earlier quarter.
So far, so good. Moving on to the bottom-line results, General Dynamics’ net income grew from $1.704 billion in the year-earlier quarter to $2.008 billion in the quarter ended June 29, 2025, representing growth of 17.8%.
It’s also worth noting that General Dynamics ended its most recently reported quarter with $1.523 billion worth of cash and cash equivalents. Therefore, it should be safe to conclude that the company has sufficient capital reserves and General Dynamics’ dividend will be safe for the foreseeable future.
Fair Valuation, Attractive Dividend
The next order of business is to determine whether General Dynamics is reasonably valued. After all, you surely wouldn’t want to hold any dividend stock through 2030 if it’s overvalued.
To keep it simple and quick, we can use the old stand-by valuation metric, the trailing 12-month price-to-earnings (P/E) ratio. Here’s a comparison of General Dynamics against the company’s best-known peers:
- General Dynamics’ P/E ratio (as of October 2, 2025): 15.37x
- Lockheed Martin’s P/E ratio: 17.81x
- Raytheon Technologies/RTX Corp.’s P/E ratio: 36.75x
- Boeing has no trailing 12-month P/E ratio as the company wasn’t earnings-positive overall during that time frame
As you can see, General Dynamics compares favorably to its competitors in this respect. The big picture looks bright for this lesser-known defense business, and by now, you might already be in the mood to start accumulating shares of GD stock.
Loading stock data...Finally, we come to the main attraction, which is General Dynamics’ quarterly dividend. Currently, the company offers a forward annual dividend yield of 1.82%.
This might not look spectacular, but it’s an attractive dividend within the aerospace/defense field. What’s important here is that General Dynamics can easily afford to maintain and even grow its dividend if the company’s management chooses to do so.
With that in mind, General Dynamics has the makings of an eventual dividend dominator in the fast-expanding defense industry. Don’t even think about sleeping on GD stock over the next several years as General Dynamics offers a potent mix of good value, financial growth, and respectable yield for passive income investors.
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