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General Dynamics stock target raised at JPMorgan but should you buy it?

General Dynamics stock target raised at JPMorgan but should you buy it? | Invezz

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By:

Motiur Rahman

on
Apr 28, 2022

General Dynamics Corporation (NYSE:GD) was assigned an overweight rating at JPMorgan with a price target of $260. This was after its earnings per share of $2.61 in the first quarter, surpassing estimates of $2.50 and the previous $2.48. The marine systems and aerospace company had booked revenue of $9.39 billion, compared to estimates of $9.02 billion.

After booking $2.65 billion in Marine systems sales, General Dynamics remained upbeat about its shipbuilding strengths. The sales were 7% higher than the prior year, with the company pointing out that the unit is demonstrating impressive growth. As a result, it expects an EPS of $2.71 in the second quarter. Although below estimates of $2.86, it demonstrates the company’s strengths. The upgrade at JPMorgan is another point that Wall Street has recognized General Dynamic’s potential in the marine and aerospace sector.


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Source – TradingView

Technically, General Dynamic’s resistance is established at $248. The level has been retested, with the stock sliding lower back to the consolidation zone. The stock could retest the support at $226, which means further downside. With strong fundamentals supporting the stock and an upgrade at JPMorgan, General Dynamics is set to breach the $248 level. However, investors should look to buy at the bottom of the consolidation around or slightly above $226. The first target should be at the $248 resistance.

Summary

General Dynamics is a buy at a lower level, potentially at $226. The company’s fundamentals are strong after a quarterly-earnings beat and outlook. The stock will continue sliding after hitting resistance at $248. The first target is $248 and potentially higher if it breaks the resistance level.

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