UTX Stock - is United Technologies' Stock a Good Buy - $UTX | Summary and Q&A

TL;DR

United Technologies (UTX) is planning to break up into three separate companies, making it an attractive investment opportunity.

Key Insights

• 🔓 The breakup of United Technologies may create value for shareholders by unlocking the true potential of each individual company.
• 💪 The new United Technology is poised for strong growth and profitability in the aerospace industry.
• 🐢 Otis and Carrier may experience slower growth due to their dependence on the economy.
• 🙃 Valuing UTX using the sum of the parts technique suggests upside potential for the stock.
• 🪘 One potential risk is the long timeframe until the breakup actually occurs, which can introduce unpredictability in the market.
• 👋 UTX stock may be a good fit for a value portfolio and potentially a dividend portfolio, depending on the stability of the dividend.

Transcript

Hey YouTube. I'm Jimmy and this video I'm going to walk through my analysis of United Technology ticker symbol UTX. This is the 25th video in our series where we're analyzing all 30 stocks in the Dow Jones Industrial Average. You can see a link in the description below for all the other videos. Then we're going to take that analysis. We're going to... Read More

Questions & Answers

Q: How will the breakup of United Technologies affect the stock?

Breaking up the company could add value for shareholders, as individual parts may be worth more than the whole company.

Q: What is the growth potential for the new United Technology?

The new United Technology is expected to have low double-digit growth and great margins, positioning it as an industry leader in the aerospace supplier market.

Q: Will Otis and Carrier experience growth similar to the new United Technology?

Otis and Carrier are likely to be lower growth companies compared to the new United Technology, but they may still achieve growth through acquisitions.

Q: How is United Technologies valued using the sum of the parts technique?

Using enterprise value to EBITDA, Otis is valued at around $28 billion, Carrier at approximately $44.5 billion, and UTX at over $100 billion.

Summary & Key Takeaways

• United Technologies (UTX) is set to break up into three companies: United Technology, Collins Aerospace, and Pratt and Whitney.

• The new United Technology will focus on the commercial aerospace and defense industries.

• Collins Aerospace supplies technology for aircrafts, while Pratt and Whitney develops aircraft engines. Otis is the world's largest escalator and elevator manufacturer, and Carrier specializes in HVAC and other building automation systems.