Reiterate Positive Stance on UTC
We continue to believe that abating profit headwinds at Otis and Pratt, combined with contribution from the pending acquisition of Rockwell Collins, set the stage for a return to DD EPS growth in FY19. Against this backdrop and at a PE of ~16x FY19E EPS (incl. COL) we continue to see an attractive long term value proposition, and expect the PE multiple to expand over the course of H218. We reiterate our Overweight rating and CY18 y/e PT of $160 (~19.5x FY19E EPS).United Technologies provides technology products and services to the building systems and aerospace industries. The company has four segments: Otis, which designs, manufactures, sells and installs passenger and freight elevators; Carrier, which provides heating, ventilating, air conditioning refrigeration, fire, security and building automation products; Pratt & Whitney, which supplies aircraft engines for the commercial, military, business jet and general aviation market; and Collins Aerospace Systems, which provides aerospace products and aftermarket service solutions for aircraft manufacturers, airlines, regional, business and general aviation markets, military, space and undersea operations.
Formed in 2003 by an established team from Cazenove, one of the most respected investment banks in the UK, Atlantic Equities conducts and publishes fundamental, bottom up research on mid and large cap US companies.
Atlantic provide order execution through a wide range of DMA products and algorithmic trading suites.
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