Using the PEG framework with analyst consensus forward EPS growth of 8.6% plus 1.7% dividend yield, General Dynamics Corporation has a fair value of $140.06 based on NTM EPS (FY2026) of $16.36. The current PEG ratio is 2.54.
PEG < 1 = bargain, 1–1.5 = fair, > 2 = expensive.
PEG tends to undervalue slow growers — consider dividend yield and asset value instead.
| EPS Growth RateForward | 6.9% |
| Dividend Yield | +1.7% |
| Adjusted Growth (clamped 8–25%) | 8.6% |
| Fair P/E | 8.6x |
| NTM EPS (FY2026) | $16.36 |
| Fair Value | $140.06 |
| Period | EPS Est. | Growth | Analysts |
|---|---|---|---|
| FY2025 (actual) | $15.46 | — | — |
| FY2026E | $16.36 | +5.8% | 17 |
| FY2027E | $18.14 | +10.9% | 16 |
| FY2028E | $19.51 | +7.6% | 17 |
| FY2029E | $21.02 | +7.7% | 14 |
| FY2030E | $21.59 | +2.7% | 8 |
5Y Forward EPS CAGR: 6.9%
| Year | Net Income | EPS | YoY |
|---|---|---|---|
| FY2021 | $3.3B | $11.55 | — |
| FY2022 | $3.4B | $12.19 | +5.5% |
| FY2023 | $3.3B | $12.02 | -1.4% |
| FY2024 | $3.8B | $13.63 | +13.4% |
| FY2025 | $4.2B | $15.46 | +13.4% |
4Y Historical EPS CAGR: 7.6%
The PEG Fair Value uses the Price/Earnings-to-Growth framework. A stock is fairly valued when its P/E ratio equals its earnings growth rate (PEG = 1.0). This model adds dividend yield to the growth rate per the original PEGY formula.
Growth rate priority: analyst consensus forward EPS CAGR (when ≥ 3 analysts cover the stock), falling back to historical EPS CAGR. Using EPS rather than net income avoids distortion from share buybacks. The growth rate is clamped between 8% and 25% — below 8% would undervalue stable earners, while above 25% would overvalue unsustainable spikes.