General Dynamics Corporation ( GD ) was awarded a contract by the U.S. Department of Defense's Defense Information Systems Agency ('DISA') to provide information technology ('IT') services in support of the Omnibus Network Enterprise ('ONE') program. This five-year, multiple-award, indefinite delivery, indefinite quantity contract has a potential value of $476 million.

Per the contract, General Dynamics will provide IT services and support to a variety of U.S. government customers via task orders issued under this contract. The support will span a range of telecommunications and information technology requirements.

Going forward, we expect General Dynamics' overall growth momentum to remain steady as its revenue exposure is spread over a broad portfolio of products and services in business aviation.

Recently, General Dynamics announced fourth quarter and fiscal 2011 operating earnings. The company reported fourth quarter earnings of $2.20 per share, which surpassed the Zacks Consensus Estimate of $2.00. The company generated total revenue of $9.1 billion in the reported quarter and failed to meet the Zacks Consensus Estimate by $206 million.

At the end of fourth quarter 2011, the company's total order backlog was $57.4 billion compared with $59.6 billion at the end of fourth quarter 2010. We believe the company's ability to get consistent contracts will influence its top line going forward. Moreover, General Dynamics' revenue exposure is spread over a broad portfolio of products and services which will keep the overall growth momentum steady. To boost its future performance, we also expect the company to focus on programs such as Gulfstream, the Warfighter Information Network - Tactical (WIN-T) program and Common Hardware/Software III (CHS-3) program.

Going by current trends, we are however concerned about the threat of budgetary cuts and the ongoing macro weakness. The company presently retains a short-term Zacks #3 Rank (Hold) that corresponds with our long-term Neutral recommendation on the stock. Similarly, its peers The Boeing Company ( BA ) and Embraer S.A. ( ">ERJ )   hold short-term Zacks #3 ranks (Hold).

Headquartered in Falls Church, Virginia, General Dynamics engages in mission-critical information systems and technologies; land and expeditionary combat vehicles, armaments and munitions; shipbuilding and marine systems; and business aviation.