General Dynamics (GD) Wins a $185M Deal to Provide Cybersecurity

General Dynamics Corp.’s GD business unit, General Dynamics Information Technology (“GDIT”), recently secured a $185 million task order to provide cybersecurity services to the U.S. Air Force Civil Engineer Center. The award has been offered by the 772nd Enterprise Sourcing Squadron at Tyndall Air Force Base, FL.

About the Contract

Per the terms of the contract, GDIT will conduct research and create new techniques to reduce cybersecurity threats to the Air Force's industrial control systems. These systems include building automation, life safety, utility monitoring and airport control.

General Dynamics will use its cybersecurity and zero trust capabilities to carry out this operation at 188 installations worldwide.

Growth Prospects

Amid growing geopolitical tensions worldwide, cyber security threats have been posing as a major risk factor to a nation’s security. As nations are rapidly expanding their investment in defense cybersecurity, the availability of safe and reliable networks to connect the operational base and fighters on the air has emerged as the need of the hour.

Consequently, as defense sectors across the board are focusing more on making their data transmission more secure, defense contractors like General Dynamics are witnessing solid contract flows involving the strengthening of cybersecurity capabilities. The latest contract win is a bright example of that.

The Defense Cybersecurity market’s prospects remain robust, driven by the continuously evolving and rising sophisticated nature of cyber-attacks. To this end, per a report by Mordor Intelligence, the Defense Cybersecurity market is projected to witness a CAGR of 12.82% during the 2024-2029 period.

Such a solid market prediction offers strong growth opportunities to General Dynamics, with its GDIT unit capable of delivering dynamic and proactive cybersecurity services as threat actors adopt new tactics and techniques. Its Everest Zero Trust solution has been designed to accelerate mission objectives by providing dynamic access to only the data and services where and when people need them, thereby securely sharing information with mission partners to achieve desired outcomes.

Meanwhile, GD’s Eclipse Defensive Cyber solution provides a comprehensive set of strategies and technologies to provide real-time threat detection, advanced incident response and remediation, as well as automated threat mitigation. Such capabilities of GDIT should enable it to win more such contracts, like the latest one, backed by the growing Defense Cybersecurity market size, which can be expected to boost its future revenue growth. 

Peer Prospects

Apart from General Dynamics, defense contractors that are expected to enjoy the perks of the growing Defense Cybersecurity spending market are as follows:   

Northrop Grumman NOC: It offers resilient, full-spectrum cyber solutions across every domain for a decisive advantage, giving cyber warfighters the defensive and offensive edge they need against evolving threats. Its products include Cyberdefense Platform for Weapon Systems, which enables cutting-edge AI/ML techniques to identify threats in mission and weapon systems that are currently undetectable by traditional network-based IDS solutions.

Northrop has a long-term (three to five years) earnings growth rate of 9.9%. The Zacks Consensus Estimate for NOC’s 2024 sales suggests growth of 4.6% from the prior-year reported figure.

Lockheed Martin LMT: It remains a leading provider of defense technology in comprehensive cyber systems for its defense and global security customers. LMT’s MR2 platform is helping the U.S. military digitally transform with real-time reports on employee training and readiness.

Lockheed has a long-term earnings growth rate of 4.2%. The Zacks Consensus Estimate for LMT’s 2024 sales implies growth of 3.2% from the prior-year reported figure.

BAE Systems BAESY: The company designs and builds a portfolio of cutting-edge cybersecurity technologies. Its product portfolio includes one-way transfer devices, guards and Field Programmable Gate Arrays like the Data Diode Solution, which is a one-way transfer device enabling secure unidirectional transfer of data between networks.

BAESY has a long-term earnings growth rate of 12.2%. The Zacks Consensus Estimate for BAESY’s 2024 sales calls for growth of 34.1% from the prior-year reported figure.

Price Movement

In the past three months, shares of General Dynamics have risen 11.2% against the industry’s decline of 0.2%.

Zacks Investment Research
Image Source: Zacks Investment Research

Zacks Rank

General Dynamics currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.


Zacks Names "Single Best Pick to Double"

From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.

It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.

This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.

Free: See Our Top Stock and 4 Runners Up >>

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

Lockheed Martin Corporation (LMT) : Free Stock Analysis Report

Northrop Grumman Corporation (NOC) : Free Stock Analysis Report

General Dynamics Corporation (GD) : Free Stock Analysis Report

Bae Systems PLC (BAESY) : Free Stock Analysis Report

To read this article on click here.

Zacks Investment Research

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

More Related Articles

Info icon

This data feed is not available at this time.

Sign up for the TradeTalks newsletter to receive your weekly dose of trading news, trends and education. Delivered Wednesdays.