On Mar 29, Zacks Investment Research marginally downgraded
United Technologies Corp
) to a Zacks Rank #3 (Hold) from a Zacks Rank #2 (Buy) Primarily
based on downward estimate revisions.
Despite the downtrend, the company still has the potential to
drive the stock up. The stock is currently trading at a forward
P/E of 16.8x with long-term growth expectations of 11.1%.
Why the downgrade?
United Technologies has witnessed downward estimate revisions
for the current quarter with estimates going down in the past 30
days. The Zacks Consensus Estimate for first quarter 2014 has
declined from $1.38 in the last 30 days to $1.27.
Some industry experts expect first quarter 2014 earnings to be
$1.25 per share, while the Zacks Consensus Estimate for the
upcoming quarter is pegged at $1.27 per share.
Restructuring costs are likely to weigh on the first quarter
results. The results are likely to be affected by one-time cuts
of 7 cents this year. United Technology, however, recently
reaffirmed its previous 2014 forecast of earnings in a range of
$6.55 to $6.85 per share on sales of about $64 billion.
The financial performance of the company largely depends on
the conditions of the construction and aerospace industries. The
company is also highly dependent on the U.S. government's
budgetary allocation for defense. A reduction in capital spending
for the commercial aviation or defense industries could have a
significant effect on demand for its products, which could in
turn have an adverse impact on its financial performance.
United Technologies currently has a Zacks Rank #3 (Hold).
Other stocks that look promising and are worth a look now include
Federal Signal Corp
), having a Zacks Rank #1 (Strong Buy), and
), both having a Zacks Rank #2 (Buy).
CLARCOR INC (CLC): Free Stock Analysis Report
FED SIGNAL CP (FSS): Free Stock Analysis
3M CO (MMM): Free Stock Analysis Report
UTD TECHS CORP (UTX): Free Stock Analysis
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