Bizjet Survey

Research evidence excerpt

Bizjet Survey

Industry Update Equity Research

Investment Thesis, Valuation and Risks

General Dynamics Corporation (GD)

Investment Thesis

After a long run of negative earnings revisions, we see GD turning the corner with our 2026 estimate ahead of consensus. GD now stands

to benefit from the multi-year refresh of its bizjet product lineup and an improving operating environment for shipbuilding along with

strong international vehicle demand. We rate the shares Overweight.

Target Price Valuation for GD

• Our $400 price target reflects GD trading at 22x 2028 FCF, a ~5% premium to where we expect defense to trade on average as

compared to current 15% discount to defense. Defense has historically traded at ~18x FCF on average while we expect the group to

trade at premium given likelihood for continued heightened geopolitical backdrop.

Risks to Our Price Target and Rating for GD

Primary risks that we see include further delays in Shipbuilding contracts along with further pressure on civil budgets impacting GDIT.

Textron Inc. (TXT)

TXT is at a larger than usual discount, but we think growth likely continues to underwhelm and it’s hard to foresee meaningful portfolio

action after all this time. Our estimates are modestly below consensus. We rate the shares Equal Weight.

Target Price Valuation for TXT

• Our $92 price target reflects TXT trading at a 15x FCF multiple on our 2028 forecast, a ~20% discount to the S&P 500, approximately

in line with its historical average.

Risks to Our Price Target and Rating for TXT

Primary risks to the downside that we see include a downturn in the bizjet cycle and cost overruns on MV-75. Primary risks to the upside

that we see include accelerated growth on MV-75.

Companies Mentioned in Report

Company Name Ticker Last Price

(06/12/26)