United
Technologies is an industrial conglomerate which manufacturers and services
aircraft engines (Pratt & Whitney), manufacturers heating, ventilating and
air conditioning equipment (Carrier), manufacturers and services elevators
(Otis), builds helicopters (Sikorsky), manufacturers aerospace and industrial
products (Hamilton Sundstrand) and provides security and fire protection
services (UTC Fire and Security). The
company has earned an 18-20% return on equity over the last ten years while
growing profits and dividends at a 13-15% rate.
While UTX ’s businesses are impacted
by the global economic activity, the company has grown fairly consistently returned
because:
(1) its main businesses possess a large parts and
service component which adds stability to earnings,
(2) the
diversity of its product line allows for consistency in revenue and earnings
performance,
(3) its strong
cash flow allows for further acquisitions and product innovation.
Negatives:
(1) a
significant portion of its business is subject to government funding,
(2) its
international operations are subject changes in foreign economies growth rates
as well as currency fluctuations and government regulations,
Statistical Summary
Stock Dividend Payout # Increases
Yield Growth Rate Ratio
Since 2003
Debt/ EPS Down Net Value Line
Equity ROE Since 2003 Margin Rating
*Because the market segments in
which these companies operate are so diverse, comparable data would be
meaningless.
Chart
Note:
UTX stock made good progress off its March
2009 low, quickly surpassing the downtrend off its October 2007 high (red line)
and the November 2008 trading high (green line). Long term, the stock is in an uptrend (straight
blue lines). Intermediate term it is in
a uptrend (purple lines). The wiggly
blue line is on balance volume. The
Dividend Growth Portfolio owns an 85% position in UTX . The upper boundary of its Buy
Value Range Sell
Half Range
4/13
No comments:
Post a Comment