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Point, counterpoint. One day after Lockheed Martin wowed Wall Street with its report of rising Q2 sales and earnings, General Dynamics (NYSE: GD), one of its biggest rivals in the defense sector, underwhelmed investors Wednesday.

Analysts had forecast General Dynamics would earn $3.27 per share on $11.4 billion in second-quarter sales. In fact, General Dynamics beat on sales, reporting revenue of $12 billion. Profits, however, came in just short of expectations at $3.26 per share.

And granted, that's a tiny miss, but investors sure seem upset about it. As of 1 p.m. ET, General Dynamics stock was down 4%.

General Dynamics' Q2 earnings

And yet, it's hard to call General Dynamics' report "bad news." Sales surged 18% year over year, powered by a massive 50% increase in aerospace revenue (i.e., Gulfstream jets). Operating profit grew even faster, up 20%. On the bottom line, well, General Dynamics' earnings may have fallen short of Wall Street's hopes, but per-share profit was still up 21%.

That sounds like a pretty great quarter to me.

Is General Dynamics stock a buy?

The question for investors now is whether General Dynamics can maintain its momentum. And the answer to that is...maybe not.

One worrisome note struck in General Dynamics' earnings report raised concerns about the prospect of future sales growth. The company's book-to-bill ratio, which compares new orders for future work General Dynamics received in the quarter versus old work it performed and converted to revenue, was an anemic 0.8. While management didn't give guidance for future sales or earnings, this would appear to foreshadow a slowdown in sales going forward.

What does this mean for investors?

Valued at 23 times earnings and paying a 1.9% dividend, General Dynamics stock would seem priced to buy if it could keep increasing earnings by 21%. Wall Street is forecasting a 14.5% growth rate. But keep an eye on that book-to-bill ratio. If it doesn't improve, General Dynamics' growth rate could be much lower.

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Rich Smith has no position in any of the stocks mentioned. The Motley Fool recommends Lockheed Martin. The Motley Fool has a disclosure policy.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.