United Technologies (UTX)

We own Raytheon and General Dynamics. United gets soft at this time in the summer. Big swing and double top, but nice little trend. Take the ITA etf, compare it to UTX and see how it’s operating. If down around $110, may be something else going on. Good spaces to be in seasonally right now.

A US industrial company with four divisions, including Otis Elevators and aerospace. Their engine business is doing well. They're closing on an acquisition that'll expand their aerospace position.They raised guidance in Q1, which they rarely do. Well-run and good management. Good balance sheet. Pays a 2.5% dividend. (Analysts' price target $146.35)

It is doing well and so is not a buy for him. They are doing a good job of making acquisitions and buying back shares.

He would sell this and buy GE. The valuation is double that of GE on a per sales basis. If you are optimistic of global economic growth and confident Mr. Trump won’t create a trade war, it is a good hold.

He prefers another name, because he feels as a conglomerate it will trade for less than the sum of the parts. He is not a fan of all their businesses – such as HVAC. Elevators and escalator growth in China has proven to be difficult to add the maintenance contracts as in Europe, North America and Japan. There are better companies.

(A Top Pick Jan 13/17. Up 28%.) Just hit new all-time highs. Has very nice dividend growth. You're looking at a 9% long-term growth rate in terms of EPS. They are acquiring Rockwell Collins, making it the world's largest aerospace supplier. That could set the stage for an eventual breakup of this conglomerate.

Their earnings profile has been in decline. They have been beating because they were communicating with the street very well. They have global growth. However he thinks there are more interesting opportunities.

A conglomerate, which makes it harder to analyse. Some of their businesses are on the upswing and some are on the downswing. He would rather be more focused, unless it is very deeply discounted, which he doesn’t believe it is.

This is in the right sector. The group is going to continue to do well. This company has about 25%-26% of its revenue that comes from Pratt & Whitney. They have about 25% that comes from their space system. This fits into the aerospace sector.

Trading at about 18X earnings with about a 10% growth rate. The acquisition of Rockwell fills a good gap for them. The stock moved down, but is now starting to push back higher. It is at about the 200-day moving average and things are moving nicely for them. The industrial space is a place you want to be in an expansionary environment.

From the last quarterly earnings, they are raising their adjusted EPS range, so that they are looking at $6.45-$6.60 in earnings. There is organic growth of 3%-4%. If the US$ were to continue to fall, the big multinationals would benefit because, instead of the foreign exchange headwinds, they would get a tailwind. He has no problem with this one.

He really likes the industrials. He likes companies that benefit from capital spending. This one fits in that camp. It had a sharp pull back and he would like to see the technical picture in place before he puts new money there.

A global provider of products and services for building services and aerospace. In the building service space, they provide equipment for heating, ventilation, air conditioning and security. This would include Carrier and Chubb. They also have a 34% share in Otis Elevators. Also, do aerospace components, engines, lighting, etc. They own Pratt and Whitney, an airplane manufacturer. Just announced the acquisition of Rockwell Collins, another aerospace manufacturer, which they expect to close a year from now. Dividend yield of 2.5%. (Analysts’ price target is $125.)

Just acquired Rockwell Collins (COL-N) for $23 billion. He likes the company. A very well-run conglomerate. There are all sorts of divisions in it, and it is a leader in the all-important aviation industry. With this acquisition, they will be able to get enhanced pricing power. 1 + 1 is going to equal 3 in terms of their positioning and ability to extract profits in that whole aviation industry. The stock is down a little, so it may be an opportune time to add to your position. On any pullback, this should be bought.

It gets you into HVAC, defense, elevators and Aerospace. They have attractive long term secular growth prospects. (Analysts’ target: $125.50).