United Technologies (UTX)

Owned for a number of years. High quality global industrial company in Aerospace, aeroparts, HVAC and elevators. Dominant with elevators in China. Positioned for recovery in non-residential buildings in the US recovery. Management is top notch, growing margin and dividends consistently. 2% dividend. Fairly valued.

(A Top Pick March 26/13. Up 30.64%.) His favourite stock. A very, very good business. Half their exposure is in the aerospace and the rest is related to construction, and he really likes the outlook for both of those categories. Great quality management and great return business, and reasonably valued.

Raytheon (RTN-N) or United Technologies (UTX-N)? Raytheon is mainly US defence which has budgetary constraints. Has generally done quite well, and generates a lot of cash flow. Pays an attractive dividend. United Technologies has a portion of their business that is close to US defence. They have Pratt (engines), Otis elevators, etc. Much more diversified. Her preference would definitely be this one.

Capital expenditure is coming back. Has been doing very well over the last 5 years, but is not much ahead of the index. They are in a sector where there will be a lot of spending over the next 3-4 years. Well-run company with a reasonable dividend.

This is symbolic of what has happened to US blue chips in the last couple of years. Have done very well and deservedly so because this is pretty much a reflection of the recovery of the industrial economy. They make aircraft engines, elevators, etc. On the flip side, the stock is trading at high teen multiples and growth is 10%-11% which seems to be the case in a lot of US blue chips. Thinks they are fairly valued, but if the economy goes the right way, there will be upside.

(A Top Pick May 7/13. Up 26.57%.) Still likes. Global industrial. Its divisions are things like Otis Elevators, Carrier, Pratt & Whitney engines, Sikorsky helicopters. Has a very strong position in terms of Otis elevators in China. Their most recent quarter is showing very strong original equipment order growth both in China and the US.

Has OTIS elevator and there is signs of significant improvement in the sector. They have Pratt and Whitney which sells in to aerospace. Likes their technologies.

Fairly priced. Steady growth, very well managed. Some talk of spinning out a helicopter division could bring some added value.

Has liked the aerospace sector for a long time and this company owns Pratt and Whitney which manufactures jet engines. Have gone through a major restructuring. The other big part of their business is more focused in the non-residential construction area such as Otis elevators and climate control. Have grown their dividend 10% year for the last 5 years.

Really likes the name. Kind of a blue chip, diversified industrial company. Somewhat cyclical, but not deep cyclical. It does have a re-occurring revenue stream from Otis elevator servicing and Pratt & Whitney engine manufacturing. About a 40% reoccurring revenue stream which will come in regardless of what the economy is doing. Well-positioned in China. Servicing component in China is very low, so they can increase that attachment rate. Also, seeing an improvement in commercial construction in North America. Have always increased their dividend.

Likes this one. A broad industrial and own Otis, Carrier, Pratt & Whitney engines, Sikorsky helicopter and they bought Goodrich a couple of years ago and nicely integrated it into their operations. Growth rates of 10%-12% are quite impressive. Not a cheap stock at $114 but feels there is some room for multiple expansion.

17.5 times earnings is relatively rich. It’s a mature holding. He is relying on organic growth to propel stock price. GE trades at a discount to this.

Loves all kinds of industrial companies and industrial stocks are the place to be. Pratt & Whitney engines, Sikorsky helicopters, Carrier air conditioners. This whole infrastructure thing is going to be driven to these kinds of products. This company went through a bit of restructuring last year and kind of got their act together. Have a fantastic history of dividend growth and a fantastic balance sheet.

Had a very strong report last week. Growing much faster organically. They brought the Goodrich acquisition in seamlessly. There was some talk that the Sikorsky division would be spun out or sold which gave them a little boost. Good value here. Not fantastic because they are still trading up around 16 or 17 times earnings. Thinks they will grow at 10% plus on the bottom line for a number of years to come.

(Top Pick Aug 28/13, Up 13.87%) Pretty much do all the infrastructure in a new building. A great company. Half business is aerospace. The replacement cycle is huge and will last for many, many years into the future. The construction market he likes also. We have not seen the recovery in commercial construction yet.