General Dynamics Corp. (NYSE:GD) has long been treated as one of the steadiest names in defense, but a new Wall Street warning about borrowing costs is putting its balance sheet in the spotlight.
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Piper Sandler named the Gulfstream jet maker and submarine builder as one of 10 S&P 1500 companies with more than $5 billion in debt and over half of it due within five years, CNBC reported.
General Dynamics carries $7 billion in debt, and 54% of it matures in the five-year window. Roughly $3.8 billion could need to be repaid or refinanced while rates sit far above where they were a few years ago.
Yields at Multi-Decade Highs
The 10-year Treasury yield touched 5.27% on Monday, its highest level since July 2007, while the 30-year yield reached 5.58%, a 22-year high.
“We continue to see higher rates as THE biggest risk to equity markets in 2026 and 2027,” Piper Sandler analyst Michael Kantrowitz wrote, per CNBC. “With spreads already so narrow, corporations are unlikely to receive meaningful additional relief from credit markets.”
Odd Company for a Prime
General Dynamics is the only defense contractor among the 10 stocks Piper Sandler flagged, per CNBC. Each entry shows total debt and the share due within five years:
- Live Nation Entertainment Inc. (NYSE:LYV): $9.4 billion, 85%
- Netflix Inc. (NASDAQ:NFLX): $17.3 billion, 84%
- Ford Motor Co. (NYSE:F): $75.4 billion, 70%
- Wells Fargo & Co. (NYSE:WFC): $249.9 billion, 67%
- Morgan Stanley (NYSE:MS): $373.2 billion, 62%
- Chevron Corp. (NYSE:CVX): $24.8 billion, 57%
- Constellation Energy Corp. (NASDAQ:CEG): $12.1 billion, 57%
- Keurig Dr Pepper Inc. (NASDAQ:KDP): $32.1 billion, 55%
- General Dynamics: $7.0 billion, 54%
- Motorola Solutions Inc. (NYSE:MSI): $8.7 billion, 53%
General Dynamics debt is shrinking, though. Total debt fell from $9.7 billion in 2023 to $8.4 billion at the end of 2025, Reuters data show. The $7 billion load is less than 8% of the company’s market value of about $90.7 billion.
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The Business is Humming
In July, General Dynamics beat second-quarter estimates with earnings of $4.24 per share and raised its 2026 profit forecast to $16.80 to $16.90 per share.
Bookings were 1.4 times billings, and Aerospace segment revenue rose 15.1% as Gulfstream ramped up production of the G700 and G800.
The Pentagon also signed seven-year agreements with its ordnance unit and Lockheed Martin Corp. (NYSE:LMT) to boost missile production.
Stock Well Off its Highs
General Dynamics’ shares closed at $334.16 on Monday, down 0.76% and about 16% below the 52-week high of $400, according to Benzinga Pro market data.
Kantrowitz noted that strong earnings could offset some of the pressure.
“Fortunately, strong earnings growth — supported by AI-related investment and improving global PMIs — has provided an important offset. Even so, higher rates for longer will inevitably place greater pressure on some companies, particularly those with elevated leverage or refinancing needs,” he wrote.
Defense demand is climbing. So is the cost of debt.
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