united technologies
New York symbol UTX, has five main businesses: Carrier makes heating and air conditioning equipment; Otis makes and services elevators; Pratt & Whitney makes aircraft engines; Flight Systems makes helicopters and aircraft controls; and UTC Fire & Security provides security and fire protection services.
SPDR DOW JONES INDUSTRIAL AVERAGE ETF $100.29 (New York Exchange symbol DIA; buy or sell through brokers) holds the 30 stocks that make up the Dow Jones Industrial Average. The fund’s top holdings are IBM, Exxon Mobil, Chevron Corp., 3M, Procter & Gamble, McDonald’s Corp., Johnson & Johnson, Caterpillar Inc., United Technologies and Boeing Co. The fund’s expenses are about 0.18% of its assets. SPDR Dow Jones ETF is a buy.
UNITED TECHNOLOGIES CORP. $66 (New York symbol UTX; Conservative Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 933.1 million; Market cap: $61.6 billion; Price-to-sales ratio: 1.2; Dividend yield: 2.6%; WSSF Rating: Above Average) has six main businesses: Pratt & Whitney makes aircraft engines (24% of 2009 revenue, 26% of earnings); Otis makes and services elevators (22%, 35%); Carrier makes heating and air-conditioning equipment (21%, 11%); Sikorsky makes helicopters (12%, 9%); Hamilton Sundstrand makes electronic aircraft controls (11%, 12%); and UTC Fire & Security sells burglar alarms and fire-protection services (10%; 7%). The U.S. government is the company’s biggest customer, and accounts for roughly 18% of its yearly revenue.
Recession hurt growth in 2009
Revenue rose 38.8%, from $42.3 billion in 2005 to $58.7 billion in 2008. However, revenue fell 9.8% in 2009, to $52.9 billion, as the recession cut demand for United Technologies’ aerospace and building-related products....
CEDAR FAIR L.P., $11.14, New York symbol FUN, is the target of a friendly, $11.50-a-unit takeover offer from Apollo Global Management, a private-investment firm. Cedar Fair owns 11 amusement parks, six outdoor water parks, one indoor water park and five hotels, mostly in the midwest and northeastern U.S. Apollo needs two-thirds of Cedar Fair’s investors to agree to its takeover. Another private-equity firm, Q Funding III LP, holds 10% of Cedar Fair and opposes Apollo’s offer. However, the units are trading at about 3% below the offer, which indicates that investors don’t expect a higher bid....
Exchange-traded funds (ETFs) may have a place in your portfolio. That’s because, unlike many other financial innovations, they don’t load you up with heavy management fees, or tie you down with high redemption charges if you decide to get out of them. Instead, they give you a low-cost, flexible, convenient alternative to mutual funds. ETFs trade on stock exchanges, just like stocks. Prices are quoted in newspaper stock tables and online. You’ll have to pay brokerage commissions to buy and sell ETFs, but you will quickly make these back because of the low management fees. Shares are only added or removed when the underlying index changes. As a result of this low turnover, you won’t incur the regular capital-gains bills generated by the yearly distributions most conventional mutual funds pay out to unitholders....
UNITED TECHNOLOGIES CORP. $70 (New York symbol UTX; Conservative Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 937.5 million; Market cap: $65.6 billion; Price-to-sales ratio: 1.2; Dividend yield: 2.2%; WSSF Rating: Above Average) is buying 49.5% of U.K.-based Clipper Windpower PLC. Clipper makes turbines and other equipment for wind-power projects. United Technologies is paying $271 million. That’s equal to 26% of the $1.1 billion, or $1.14 a share, that it earned in the three months ended September 30, 2009. Clipper is currently losing money. However, demand for wind-power equipment is growing strongly as countries look for ways to cut their fossil-fuel use. Clipper should also benefit from United Technologies’ jet-engine and fuel-cell expertise. Moreover, it can use United Technologies’ distribution network to increase its sales....
KRAFT FOODS INC., $26.91, New York symbol KFT, has made a formal offer to buy U.K.-based Cadbury plc (New York symbol CBY). Cadbury is a leading maker of confectioneries, including chocolate, candy and gum. Kraft is offering roughly $16.5 billion in cash and stock. That’s equal to 42% of its $39.7-billion market cap. Cadbury has rejected the takeover, and its shares are trading slightly above the value of Kraft’s offer. That suggests investors are expecting a higher bid from Kraft or another company....
DIAMONDS TRUST SHARES $98.27 (New York Exchange symbol DIA; buy or sell through brokers) hold the 30 stocks that make up the Dow Jones Industrial Average. The fund’s top 10 holdings are IBM, Exxon Mobil, Chevron Corp., 3M, Procter & Gamble, McDonald’s Corp., Johnson & Johnson, Caterpillar Inc., United Technologies and Coca-Cola. The fund’s expenses are about 0.18% of its assets. Diamonds Trust Shares are a buy.
While ETFs won’t protect you from the three costliest mistakes an investor can make, they may have a worthwhile place in your portfolio. Unlike many other innovations, ETFs don’t load you up with heavy management fees, or tie you down with heavy redemption charges if you decide to get out of them. Instead, they give you a lower-cost and more flexible and convenient alternative to mutual funds. ETFs trade on stock exchanges, just like stocks. Prices are quoted in newspaper stock tables and online. You’ll have to pay brokerage commissions to buy and sell them, but you will quickly make these back because of the low management fees....
INVACARE CORP. $23 earned $0.30 a share in the second quarter of 2009, up 36.4% from $0.22 a year earlier. Much of the gain came from the company’s ongoing restructuring plan, which started in July 2005. Under the plan, Invacare is shifting production of wheelchairs, motorized scooters and other mobility and homecare products to low-cost countries and simplifying its product lines. Revenue fell 7.7%, to $412.5 million from $447.2 million, mostly due to unfavourable foreign-exchange rates. Buy. UNITED TECHNOLOGIES CORP. $63 still expects to earn about $4.08 a share this year, despite slow demand for its aerospace and construction-related products. As well, it expects its 2010 earnings to rise, mainly due to cost cuts. Buy. VERIZON COMMUNICATIONS INC. $30 has raised its quarterly dividend by 3.3%, to $0.475 a share from $0.46. The new annual rate of $1.90 yields 6.3%. Best Buy.
UNITED TECHNOLOGIES CORP., $52.23, New York symbol UTX, makes a variety of products for the aerospace and construction industries. Its main subsidiaries are Pratt & Whitney (jet engines), Hamilton Sundstrand (aircraft electronics), Carrier (heating and air conditioning) and Otis (elevators). The recession continues to weigh on many of United Technologies’ clients. As a result, the company’s revenue fell 17.2% in the three months ended June 30, 2009, to $13.2 billion from $15.9 billion a year earlier. As well, United Technologies gets about 50% of its revenue from overseas operations, so unfavourable foreign-exchange rates accounted for about a third of the drop. Earnings in the quarter fell 23.5%, to $976 million, or $1.05 a share, from $1.3 billion, or $1.32 a share. However, if you exclude severance costs and other one-time items, the company would have earned $1.21 a share in the latest quarter. That beat the $1.04 that analysts were expecting....