Industrials Capital Protection Certificate

US rates are still high, giving the opportunity to consider full capital protection structured products. The following instrument has only two stocks in the basket with participation coefficient 100% and no cap on the equity price growth in two or three years.

Companies represent Industrials sector. For Mitsubishi Corp the 10-year CAGR stands at 20%. Additionally, Mitsubishi stock has delivered positive returns in 80% of rolling three-year periods over the last decade. For General Dynamics stock, the 10-year CAGR stands at 8%. In 88% of rolling three-year periods over the last decade, GD has delivered positive returns.

Mitsubishi Corporation [Internal score 74/100] is Japan’s largest and most profitable general trading house. The company operates in the following sectors: Natural Gas & Mineral Resources, Power Solutions, Automobiles, and Consumer Goods. In early June, new corporate strategy for 2027- 2028 was presented. It was stated that operating cash flow growth an average should be 10% annually and return on equity – 12% or higher.

Historically, Mitsubishi’s business model has been structured such that more than half of its net profit is earned outside Japan. Industrial goods are exported to the United States and Europe; commodities are exported from Australia and South America and sold in Asia-Pacific region.

In the first quarter of 2026, the company’s revenue grew by 23% year-over-year to $32,5 billion. Net profit for the same period rose by 30% year-over-year to $1.7 billion. Gross margin for the past quarter was around 10%. FCF for the second quarter amounted to $2.2 bln.

General Dynamics Corporation [Internal score 94/100] is an American defense and aerospace giant. The company generates revenue across four segments: Marine Systems (32%), Aerospace (25%), Technologies (25%), and Combat Systems (18%). Its backlog reached $136.5 billion as of the second quarter of 2026. Additionally, global growth in defense budgets of NATO and the US should have a positive effect on GD financial results.

According to the recent financial report for the past quarter of 2026 revenue increased 8% yo-y and amounted to $14 billion. EBITDA margin for the quarter was around 12% level. Net income exceeds $1.1 billion vs $1.0 billion for the same quarter in 2025. Company was able to generate positive FCF, which is 11% of the revenue. Current FCF level is $1.6 billion.

The timing is attractive because the September Fed hike may have taken US yields close to their near-term peak: weak jobs data have cut the chance of another increase on 28 October to below 20%, so today’s high yields may not last. At the same time, both shares have near-term catalysts, with General Dynamics reporting on 30 October and Mitsubishi on 4 November. Entering before those results locks in favourable rates while leaving room for stronger earnings or guidance to drive the equity upside.