Markets

United Technologies reports fourth-quarter numbers January 25

What's Happening

Defense contractor United Technologies ( UTX ) is expected to report its fourth-quarter numbers on January 25 before the market open. Analysts expect to see earnings of $1.56 per share, up from $1.53 during the same period last year. UTX stock is up 14.7% over the last year.

Technical Analysis

UTX was recently trading at $110.17, down $2.66 from its 12-month high and $26.32 above its 12-month low. Overall technical indicators for UTX are bullish with a strong upward trend. The stock has recent support above $106.35, and recent resistance below $112.85. Of the 15 analysts who cover the stock, six rate it a "strong buy", one rates it a "buy", seven rate it a "hold", and one rate it a "strong sell". The stock receives S&P Capital IQ's 4 STARS "Buy" ranking.

Analyst's Thoughts

There is a lot of optimism surrounding the defense sector at this time. President Trump promises to build all branches of the military, which is the primary reason why shares in defense contractors like United Technologies have soared since the election. The consensus calls for earnings of $1.56 per share, but the street has a slightly higher whisper number of $1.60, indicating strong optimism in the company's underlying business. UTX has a good earnings record, having topped analyst estimates for seven straight quarters, and another earnings beat should push the stock higher towards a new 52-week high.

Stock Only Trade

Bullish Trade

If you want a bullish hedged trade on the stock, consider a May 90/95 bull-put credit spread for a 35-cent credit. That's a potential 7.5% return (23.0% annualized*) and the stock would have to fall 13.5% to cause a problem.

Bearish Trade

If you want to take a bearish stance on the stock at this time, consider a May 120/125 bear-call credit spread for a $0.45 credit. That's a potential 9.9% return (30.3% annualized*) and the stock would have to rise 9.3% to cause a problem.

Covered Call Trade

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Originally published on InvestorsObserver.com


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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