6 Days Left To Cash In On General Dynamics Corporation (NYSE:GD) Dividend, Is It Worth Buying?

Investors who want to cash in on General Dynamics Corporation's (NYSE:GD) upcoming dividend of $0.84 per share have only 6 days left to buy the shares before its ex-dividend date, 18 January 2018, in time for dividends payable on the 09 February 2018. Is this future income stream a compelling catalyst for dividend investors to think about the stock as an investment today? Let's take a look at General Dynamics's most recent financial data to examine its dividend characteristics in more detail. See our latest analysis for General Dynamics

5 questions to ask before buying a dividend stock

Whenever I am looking at a potential dividend stock investment, I always check these five metrics:

• Is it the top 25% annual dividend yield payer?
• Has it paid dividend every year without dramatically reducing payout in the past?
• Has it increased its dividend per share amount over the past?
• Is is able to pay the current rate of dividends from its earnings?
• Based on future earnings growth, will it be able to continue to payout dividend at the current rate?

How does General Dynamics fare?

The company currently pays out 30.44% of its earnings as a dividend, meaning the dividend is sufficiently covered by earnings. Going forward, analysts expect GD's payout to increase to 33.69% of its earnings, which leads to a dividend yield of 1.83%. However, EPS is forecasted to fall to $10.48 in the upcoming year. Therefore, although payout is expected to increase, the fall in earnings may not equate to higher dividend income. If there's one type of stock you want to be reliable, it's dividend stocks and their stable income-generating ability. GD has increased its DPS from $1.16 to $3.36 in the past 10 years. It has also been paying out dividend consistently during this time, as you'd expect for a company increasing its dividend levels. This is an impressive feat, which makes GD a true dividend rockstar. In terms of its peers, General Dynamics generates a yield of 1.64%, which is high for aerospace and defense stocks but still below the low risk savings rate.

What this means for you:

Are you a shareholder? With General Dynamics producing strong dividend income for your portfolio over the past few years, you can take comfort in knowing that this stock will still continue to be a robust dividend generator moving forward. But, depending on your portfolio composition, it may be valuable exploring other dividend stocks to enhance your diversification, or even look at high-growth stocks to complement your steady income stocks. I encourage you to continue your research by checking out my interactive free list of dividend rockstars as well as high-growth stocks to potentially add to your holdings.

Are you a potential investor? Taking into account the dividend metrics, General Dynamics ticks most of the boxes as a strong dividend investment, putting it in my list of top dividend payers. I also recommend taking sufficient time to understand its core business and determine whether the company and its investment properties suit your overall goals. Whether or not you like General Dynamics as a dividend stock, it's still worth checking the price tag. Can you buy General Dynamics for a great price? Dig deeper in our latest free analysis to find out!

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Simply Wall St analyst Simply Wall St and Simply Wall St have no position in any of the companies mentioned. This article is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.