Executive Summary
General Dynamics (GD) is a market leader in business aviation; land and expeditionary combat vehicles and systems, armaments, and munitions; shipbuilding and marine systems; and mission-critical information systems and technologies (Gendyn, 2008). Lockheed Martin (LMT) is a leading multinational aerospace manufacturer and advanced technology company formed in 1995 by the merger of Lockheed Corporation with Martin Marietta (Lockheed, 2008). I have compared both companies under various criteria such as ratio analysis, stock price performance, common size financial statements and then have tried to comment on which is company is better.
The current market price of General Dynamics is $92.46 and the average target price is $100, which represents a premium of around 8% from the current level. On the other hand, the current market price of Lockheed Martin is $117 and the average target price is $124, which implies a premium of around 6%.
From the comparison of both companies based on the financial and market analysis, General Dynamics has been on a growth trend. If an investor wants to invest in a company which has better long term growth, General Dynamics would be a better option as compared to Lockheed Martin. Most of the margin is better for General Dynamics as compared to Lockheed Martin and also growth in sales and earnings before interest and taxes is better for General Dynamics as compared to Lockheed Martin.
Some of the key reasons why General Dynamics should be selected for investment are summarized below:
? When both companies are compared based on profitability and margin analysis we can see that General Dynamics is better placed than Lockheed Martin
? The liquidity position of General Dynamics ...