Morningstar Rating

Stock Research and Analysis

by Keith Schoonmaker, CFA

Bulls Say

Pratt & Whitney's re-entry into the narrow-body market is a noteworthy feat and gives the division a strong growth platform for several years.
With roughly 20% exposure to the emerging markets, United Technologies has growth tailwinds, which should help it grow in the event of slower growth in developed economies.
A number of United Technologies' businesses are still below peak revenue from 2008, with ample room to increase the top line and operating margin. Read more 

Bears Say

A protracted global slowdown could reduce United Technologies' overall growth profile, which is already a bit lower than industry peers.
Pratt & Whitney will see more demand than it has in some time, potentially straining internal resources and the supply chain. Profitability could be at risk if the firm is unable to execute in a faster-paced environment.
Commodity costs may create volatility in earnings, even if they rise and fall sporadically. Read more 

Management

United Technologies' corporate-governance policies are solid, and we think management and the board will act in the best interests of the common shareholder. Louis Chenevert was elected president and CEO in April 2008 and became chairman in January   Read more 

Profile

United Technologies is a diversified conglomerate with 2013 revenue of $62 billion and business operations serving primarily construction and aerospace markets. Otis elevators,  Read more 

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3 Picks in a Richly Valued Market 
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