The company you are referring to, GenCorp Inc. (with the stock symbol history of GY), no longer exists as an independent, publicly traded entity.
The original GenCorp Inc., a diversified company that historically owned General Tire and Aerojet, underwent significant corporate changes:
Name Change: GenCorp Inc. was officially renamed Aerojet Rocketdyne Holdings, Inc. (ticker symbol AJRD) on April 27, 2015.
Acquisition: Aerojet Rocketdyne Holdings, Inc. (AJRD) was subsequently acquired by L3Harris Technologies (LHX) in an all-cash transaction valued at $4.7 billion, which closed in July 2023.
Therefore, any fundamental analysis of "GenCorp Inc." today must focus on its last iteration, Aerojet Rocketdyne, and its current position as a segment within L3Harris Technologies.
Fundamental Analysis of the Former GenCorp Inc. (Aerojet Rocketdyne)
Another company, Gencor Industries Inc. (GENC), still exists as a separate publicly traded entity in the heavy construction equipment industry (primarily asphalt plants). Given the historical confusion, this article will focus on the most likely intended company: GenCorp Inc. / Aerojet Rocketdyne.
Fundamental Analysis of the Former GenCorp Inc. (Aerojet Rocketdyne)
Introduction: From Conglomerate to Aerospace Powerhouse
The corporate entity known historically as GenCorp Inc. underwent a dramatic transformation, evolving from a diversified conglomerate—which originally began as the General Tire and Rubber Company in 1915—to a pure-play aerospace and defense company. This final form, Aerojet Rocketdyne Holdings, Inc. (AJRD), became a critical supplier in the U.S. defense and space industrial base before its ultimate acquisition by L3Harris Technologies (LHX) in 2023.
A fundamental analysis of GenCorp/Aerojet Rocketdyne (pre-acquisition) centers on its specialized role in propulsion systems and energetics, a sector characterized by high barriers to entry, long-term government contracts, and significant technological dependence.
1. Business Overview and Industry Dynamics
A fundamental analysis begins with understanding the core business. Aerojet Rocketdyne (the former GenCorp) was a world-recognized leader in aerospace and defense propulsion systems.
Core Business Segments
| Segment | Description | Strategic Importance |
| Space Propulsion | Rocket engines for NASA's major programs (e.g., the RS-25 for the Space Launch System) and commercial launch providers (e.g., the RL10 engine). | Highly specialized, long-cycle contracts with substantial government funding. |
| Defense Systems | Propulsion and energetics for tactical and strategic missiles, missile defense systems (like the PAC-3), and hypersonics. | Critical supplier to major defense primes (like Lockheed Martin and Raytheon), benefiting directly from global defense spending trends. |
| Real Estate | The non-core business of developing, selling, or leasing excess land holdings, mostly in California (the Easton Development Co.). | Provided periodic non-operational cash inflows, though secondary to the main business. |
Competitive Advantage (Moat)
Aerojet Rocketdyne possessed a strong economic moat derived primarily from its high-tech specialization and role as a "merchant supplier."
Proprietary Technology and Intellectual Property: The company owned a wealth of advanced, flight-proven propulsion technology, particularly for liquid and solid-fueled rocket engines, which are exceptionally difficult and costly to replicate.
Customer Entrenchment: The U.S. Department of Defense (DoD) and NASA rely on a limited number of certified suppliers for mission-critical components. Switching suppliers is almost impossible due to stringent qualification processes, creating stable, long-term revenue visibility.
Scale and Scope: Following the merger of Aerojet and Pratt & Whitney Rocketdyne in 2013, the company became one of only two major independent U.S. suppliers of rocket propulsion, enhancing its pricing power and leverage.
2. Financial Performance & Valuation Metrics (Pre-Acquisition)
Analyzing the financials of the former Aerojet Rocketdyne (AJRD) focused on stability, contract backlog, and efficiency, typical for a defense contractor.
Revenue and Backlog
Defense and aerospace companies are valued heavily on their backlog—the amount of work contracted but not yet executed. AJRD historically maintained a strong, multi-year backlog, which provided excellent revenue visibility and predictability, a key fundamental positive. Revenue growth was typically tied to increased DoD/NASA spending, new missile programs (like hypersonics), and major space contracts.
Profitability and Efficiency
| Metric | Typical Interpretation for AJRD | Fundamental Insight |
| Operating Margin | Historically stable but somewhat constrained by the nature of cost-plus government contracts and substantial R&D investments. | Indicated efficient program management, but margins lagged some software-heavy defense peers. |
| Return on Invested Capital (ROIC) | Crucial metric for capital-intensive manufacturers; demonstrated the management team's ability to efficiently allocate capital. | A consistent, high ROIC was a sign of a strong business, but environmental cleanup and pension liabilities from the GenCorp era often weighed on overall returns. |
Valuation Multiples
Prior to the L3Harris acquisition offer, AJRD's valuation was typically assessed using metrics common for mature industrial or defense companies:
P/E Ratio (Price-to-Earnings): Often traded at a slight discount or in line with major defense primes, reflecting its supplier role versus the prime contractor role (e.g., Lockheed Martin).
P/S Ratio (Price-to-Sales): Generally favored due to high asset base and large long-term contracts. A lower P/S suggested potential undervaluation relative to its high-tech, indispensable product line.
Enterprise Value-to-EBITDA (EV/EBITDA): Highly relevant for comparing capital-intensive firms, often reflecting the value of its high-tech assets and long-term contracts.
3. Key Risks and Acquisition Catalysts
Major Risk Factors
Government Funding Risk: A substantial majority of revenue was derived from U.S. government contracts. Any cutbacks, program cancellations, or delays in government appropriations presented a major financial risk.
Competition and Supply Chain: While competition was limited, the defense industry remains highly concentrated. Also, as a key supplier, AJRD’s fortunes were linked to the success and demand for its prime contractor customers’ (e.g., Boeing, Lockheed Martin, Northrop Grumman) final products.
Legacy Liabilities: The corporate history of GenCorp left behind significant, non-operating environmental remediation (cleanup) and defined-benefit pension liabilities, which required considerable cash outlays and often acted as a drag on reported earnings and free cash flow.
The Acquisition by L3Harris Technologies
The ultimate conclusion of the GenCorp/Aerojet Rocketdyne story was its acquisition by L3Harris Technologies (LHX) in July 2023. This event served as the final validation of the company's fundamental value:
Premium Valuation: L3Harris paid $58 per share, an all-cash transaction at a significant premium, indicating the perceived scarcity and intrinsic value of AJRD's propulsion technology.
Strategic Rationale: The acquisition was driven by L3Harris's desire to vertically integrate and secure a critical component of the U.S. defense supply chain. By acquiring a pure-play engine maker, L3Harris gained control over technology essential for future missile, hypersonic, and space programs, strengthening its overall defense portfolio.
FTC Scrutiny: The fact that the Federal Trade Commission (FTC) blocked a previous, similar bid by Lockheed Martin but approved the L3Harris deal underscores the strategic importance of Aerojet Rocketdyne as a "merchant supplier"—its independent status was crucial for maintaining competition among the primary defense contractors.
Conclusion
The fundamental analysis of the former GenCorp Inc. confirms its shift into a highly valuable, niche aerospace and defense manufacturer. Its investment thesis was founded on a strong, protected economic moat built on irreplaceable technology, reinforced by stable, long-term government and commercial contracts.
The company's journey culminated in an acquisition that realized significant shareholder value, effectively valuing the core business at a premium due to its strategic, mission-critical role in U.S. national security and space exploration. Investors seeking exposure to this business line must now analyze the performance of L3Harris Technologies' (LHX) new Aerojet Rocketdyne segment within the context of the larger company's financial and strategic goals.