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General Dynamics (FRA:GDX) Owner Earnings per Share (TTM) : 7.83 (As of Mar. 2024)


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What is General Dynamics Owner Earnings per Share (TTM)?

In 1986 Berkshire Hathaway Shareholder Letter, Warren Buffett defined owner earnings as follows:

"These represent (a) reported earnings plus (b) depreciation, depletion, amortization, and certain other non-cash charges...less (c) the average annual amount of capitalized expenditures for plant and equipment, etc. that the business requires to fully maintain its long-term competitive position and its unit volume (If the business requires additional working capital to maintain its competitive position and unit volume, the increment also should be included in (c))...Our owner-earnings equation does not yield the deceptively precise figures provided by GAAP, since (c) must be a guess - and one sometimes very difficult to make. Despite this problem, we consider the owner earnings figure, not the GAAP figure, to be the relevant item for valuation purposes - both for investors in buying stocks and for managers in buying entire businesses...All of this points up the absurdity of the 'cash flow' numbers that are often set forth in Wall Street reports. These numbers routinely include (a) plus (b) - but do not subtract (c)."

General Dynamics's Owner Earnings per Share (TTM) ended in Mar. 2024 was €7.83. It's Price-to-Owner-Earnings ratio for today is 35.58.


The historical rank and industry rank for General Dynamics's Owner Earnings per Share (TTM) or its related term are showing as below:

FRA:GDX' s Price-to-Owner-Earnings Range Over the Past 10 Years
Min: 8.83   Med: 17.88   Max: 52.47
Current: 35.59


During the past 13 years, the highest Price-to-Owner-Earnings ratio of General Dynamics was 52.47. The lowest was 8.83. And the median was 17.88.


FRA:GDX's Price-to-Owner-Earnings is ranked worse than
63.49% of 126 companies
in the Aerospace & Defense industry
Industry Median: 22.98 vs FRA:GDX: 35.59

General Dynamics's Earnings per Share (Diluted) for the three months ended in Mar. 2024 was €2.65. Its Earnings per Share (Diluted) for the trailing twelve months (TTM) ended in Mar. 2024 was €11.33. It's PE Ratio ratio for today is 24.59.

General Dynamics's EPS without NRI for the three months ended in Mar. 2024 was €2.65. Its EPS without NRI for the trailing twelve months (TTM) ended in Mar. 2024 was €11.33. It's PE Ratio without NRI ratio for today is 24.59.


General Dynamics Owner Earnings per Share (TTM) Historical Data

The historical data trend for General Dynamics's Owner Earnings per Share (TTM) can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

* Premium members only.

General Dynamics Owner Earnings per Share (TTM) Chart

General Dynamics Annual Data
Trend Dec14 Dec15 Dec16 Dec17 Dec18 Dec19 Dec20 Dec21 Dec22 Dec23
Owner Earnings per Share (TTM)
Get a 7-Day Free Trial Premium Member Only Premium Member Only 7.04 8.82 12.75 13.64 12.54

General Dynamics Quarterly Data
Jun19 Sep19 Dec19 Mar20 Jun20 Sep20 Dec20 Mar21 Jun21 Sep21 Dec21 Mar22 Jun22 Sep22 Dec22 Mar23 Jun23 Sep23 Dec23 Mar24
Owner Earnings per Share (TTM) Get a 7-Day Free Trial Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 11.29 11.15 10.88 12.54 7.78

Competitive Comparison of General Dynamics's Owner Earnings per Share (TTM)

For the Aerospace & Defense subindustry, General Dynamics's Price-to-Owner-Earnings, along with its competitors' market caps and Price-to-Owner-Earnings data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.


General Dynamics's Price-to-Owner-Earnings Distribution in the Aerospace & Defense Industry

For the Aerospace & Defense industry and Industrials sector, General Dynamics's Price-to-Owner-Earnings distribution charts can be found below:

* The bar in red indicates where General Dynamics's Price-to-Owner-Earnings falls into.



General Dynamics Owner Earnings per Share (TTM) Calculation

In 1986 Berkshire Hathaway Shareholder Letter, Warren Buffett defined owner earnings as follows:

"These represent (a) reported earnings plus (b) depreciation, depletion, amortization, and certain other non-cash charges...less (c) the average annual amount of capitalized expenditures for plant and equipment, etc. that the business requires to fully maintain its long-term competitive position and its unit volume. (If the business requires additional working capital to maintain its competitive position and unit volume, the increment also should be included in (c))...Our owner-earnings equation does not yield the deceptively precise figures provided by GAAP, since (c) must be a guess - and one sometimes very difficult to make. Despite this problem, we consider the owner earnings figure, not the GAAP figure, to be the relevant item for valuation purposes - both for investors in buying stocks and for managers in buying entire businesses...All of this points up the absurdity of the 'cash flow' numbers that are often set forth in Wall Street reports. These numbers routinely include (a) plus (b) - but do not subtract (c)."

To make it simple, then you will have:

Owner Earnings per Share (TTM) = (Net Income + Depreciation, Depletion and Amortization + Change In Deferred Tax - 5Y Average of Maintenance Capital Expenditure + Change In Working Capital) / Shares Outstanding (Diluted Average)

General Dynamics's Owner Earnings per Share (TTM) Calculation:

TTM / Last Quarter Average of Last 20 Quarters
Net Income 3,127
Depreciation, Depletion and Amortization 784
Change In Deferred Tax -115
5Y Average of Maintenance Capital Expenditure 680
Change In Working Capital -941
Shares Outstanding (Diluted Average) 277

1. Start with "Net Income" from income statement. General Dynamics's Net Income for the trailing twelve months (TTM) ended in Mar. 2024 was €3,127 Mil.

2. "Depreciation, Depletion and Amortization" is from cashflow statement. General Dynamics's Depreciation, Depletion and Amortization for the trailing twelve months (TTM) ended in Mar. 2024 was €784 Mil. This needs to be added back because company does not actually need to pay cash for it. It is a non-cash item.

3. Other non-cash charges usually include "Stock Based Compensation" and "Change In Deferred Tax":
However, to be conservative, GuruFocus will not add Stock Based Compensation back to net income. General Dynamics's Change In Deferred Tax for the trailing twelve months (TTM) ended in Mar. 2024 was €-115 Mil.

4. Average maintenance capital expenditure over a business/industry cycle: 5-Year Average Maintenance Capital Expenditure = €680 Mil

It is usually best to take a long-term average of maintenance capital expenditure. Ideally this would be as long as 10 years and include at least one economic downturn. However, since many companies do not have as long as 10-year history, here GuruFocus uses the latest 5 years data to do the calculation. To smooth out unusual years but reflect recent developments, we take an average of the 5 year maintenance capital expenditure.

The following shows how to get maintenance capital expenditure.

First, calculate the revenue change regarding to the previous quarter. If the revenue decreased from the previous quarter, then the Maintenance Capital Expenditure = Capital Expenditure (positive).
Second, if the revenue increased from the previous quarter, then calculate the percentage of Net PPE as of corresponding Revenue.
Growth Capital Expenditure = Percentage of Property, Plant and Equipment as of corresponding Revenue * Revenue Increase
Third, calculate Capital Expenditure (positive) - Growth Capital Expenditure.
If [Capital Expenditure (positive) - Growth Capital Expenditure] was negative, then the Maintenance Capital Expenditure = Capital Expenditure (positive).
If [Capital Expenditure (positive) - Growth Capital Expenditure] was positive, then the Maintenance Capital Expenditure = Capital Expenditure (positive) - Growth Capital Expenditure.
Fourth, get the average of the 5 years maintenance capital expenditure.

General Dynamics's 5-Year Average Maintenance Capital Expenditure = €680 Mil

5. "Change In Working Capital" is from cashflow statement. General Dynamics's Change In Working Capital for the trailing twelve months (TTM) ended in Mar. 2024 was €-941 Mil.
Note: GuruFocus' Change in Working Capital is provided by Morningstar. It is calculated by adding the items under "Change in operating assets and liabilities" (may refer to a different name for different company) section in Cash Flow Statement from original financial report. And sometimes it includes non-current parts of assets and liabilities.

6. General Dynamics's Shares Outstanding (Diluted Average) for the months ended in Mar. 2024 was 277.004 Mil.

General Dynamics's Onwer Earnings Per Share for Mar. 2024 is calculated as:

Owner Earnings per Share (TTM)
=( Net Income+Depreciation, Depletion and Amortization+Change In Deferred Tax
=( 3126.709 +783.651+-115.2
-5Y Avg of Maintenance CAPEX+Change In Working Capital )/Shares Outstanding (Diluted Average)
-679.54228445225+-941.267)/277.004
=7.83

Price-to-Owner-Earnings=Current Price/Owner Earnings per Share (TTM)
=278.60/7.83
=35.58

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.


Be Aware

Assumption: Companies usually do not report maintenance capital expenditures and growth capital expenditures separately. Here we use estimated numbers and average them over 5 years. The method to estimate maintenance capital expenditures can be found in above part 4.

Note: GuruFocus' Change In Working Capital is provided by Morningstar. It is calculated by adding the items under "Change in operating assets and liabilities" (may refer to a different name for different company) section in Cash Flow Statement from original financial report. And it includes non-current parts of assets and liabilities.


General Dynamics Owner Earnings per Share (TTM) Related Terms

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General Dynamics (FRA:GDX) Business Description

Address
11011 Sunset Hills Road, Reston, VA, USA, 20190
General Dynamics is a defense contractor and business jet manufacturer. The firm's segments include aerospace, marine, combat systems, and technologies. General Dynamics' aerospace segment creates Gulfstream business jets and operates a global aircraft servicing operation. Combat systems produces land-based combat vehicles such as the M1 Abrams tank and Stryker armored personnel carrier, as well as munitions. The marine segment creates and services nuclear-powered submarines, destroyers, and other ships. The technologies segment contains two main units, an IT business that primarily serves the government market and a mission systems business that focuses on products that provide command, control, computing, intelligence, surveillance, and reconnaissance capabilities to the military.

General Dynamics (FRA:GDX) Headlines

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