General Dynamics Corporation (NYSE:GD): What You Have To Know Before Buying For The Upcoming Dividend

Shares of General Dynamics Corporation (NYSE:GD) will begin trading ex-dividend in 3 days. To qualify for the dividend check of $0.93 per share, investors must have owned the shares prior to 12 April 2018, which is the last day the company's management will finalize their list of shareholders to which they will send dividend payments. Investors looking for higher income-generating stocks to add to their portfolio should keep reading, as I take a deeper dive into General Dynamics's latest financial data to analyse its dividend attributes. See our latest analysis for General Dynamics

5 questions I ask before picking a dividend stock

When assessing a stock as a potential addition to my dividend Portfolio, I look at these five areas:

• Is it paying an annual yield above 75% of dividend payers?
• Has its dividend been stable over the past (i.e. no missed payments or significant payout cuts)?
• Has dividend per share amount increased over the past?
• Is it able to pay the current rate of dividends from its earnings?
• Will it have the ability to keep paying its dividends going forward?

How well does General Dynamics fit our criteria?

The company currently pays out 34.52% of its earnings as a dividend, according to its trailing twelve-month data, which means that the dividend is covered by earnings. In the near future, analysts are predicting a payout ratio of 32.33%, leading to a dividend yield of around 1.81%. Moreover, EPS should increase to $11.41. If there is one thing that you want to be reliable in your life, it's dividend stocks and their constant income stream. GD has increased its DPS from $1.4 to $3.72 in the past 10 years. During this period it has not missed a payment, as one would expect for a company increasing its dividend. This is an impressive feat, which makes GD a true dividend rockstar. Compared to its peers, General Dynamics generates a yield of 1.72%, which is on the low-side for Aerospace & Defense stocks.

Next Steps:

Considering the dividend attributes we analyzed above, General Dynamics is definitely worth keeping an eye on for someone looking to build a dedicated income portfolio. Given that this is purely a dividend analysis, you should always research extensively before deciding whether or not a stock is an appropriate investment for you. I always recommend analysing the company's fundamentals and underlying business before making an investment decision. Below, I've compiled three essential factors you should further examine:

1. Future Outlook: What are well-informed industry analysts predicting for GD’s future growth? Take a look at our free research report of analyst consensus for GD’s outlook.
2. Valuation: What is GD worth today? Even if the stock is a cash cow, it's not worth an infinite price. The intrinsic value infographic in our free research report helps visualize whether GD is currently mispriced by the market.
3. Other Dividend Rockstars: Are there better dividend payers with stronger fundamentals out there? Check out our free list of these great stocks here.

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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.