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.
General Dynamics retreating after resistance at $248
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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