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United Technologies (UTX) Q2 Earnings Top, '18 EPS View Up

United Technologies CorporationUTX reported better-than-expected results for second-quarter 2018.

Earnings/Revenues

Quarterly adjusted earnings came in at $1.97 per share, surpassing the Zacks Consensus Estimate. The reported figure also came in higher than the year-ago tally of $1.85 per share.

Revenues in the reported quarter came in at $16,705 million, up 9.3% year over year. The top line also outpaced the Zacks Consensus Estimate of $16,264 million. Revenues grew 6% year over year organically.

Segmental Break-Up

Otis revenues in the quarter were $3,344 million, up 6.8% year over year. Aggregate sales of the UTC Climate, Controls & Security segment expanded 6.9% year over year to $5,035 million. The Pratt & Whitney segment's Q2 revenues came in at $4,736 million, up 16.4% from the year-ago tally. The top-line performance of the UTC Aerospace Systems segment improved 8.8% year over year to $3,962 million.

United Technologies Corporation Price, Consensus and EPS Surprise

United Technologies Corporation Price, Consensus and EPS Surprise | United Technologies Corporation Quote

Costs/Margins

Cost of products and services sold during the quarter was $12,422 million, up 11.3% year over year.

Selling, general and administrative expenses in the second quarter flared up 10.6% year over year to $1,759 million.

Adjusted operating margin the quarter was 14.2%, down 80 basis points from the year-ago figure.

Balance Sheet/Cash Flow

Exiting the second quarter, United Technologies had cash and cash equivalents of $11,068 million, up from $8,985 million recorded as of Dec 21, 2017. Long-term debt stood at $27,246 million, up from $24,989 million recorded at the end of 2017.

During the April-June quarter, the company generated $2,102 million cash from operating activities, down 2.1% year over year. Capital expended was down 16.6% year over year to $372 million.

Outlook

United Technologies has raised its 2018 earnings view to $7.10-$7.25 per share from the prior guidance of $6.95-$7.15 per share. Revenue for the full year are predicted to lie in the $63.5-$64.5 billion range, estimating organic growth rate of 5-6%.

Zacks Rank & Stocks to Consider

United Technologies currently carries a Zacks Rank #3 (Hold). Some better-ranked stocks are listed below:

Hitachi Ltd. HTHIY sports a Zacks Rank of 1 (Strong Buy). The company pulled off an average positive earnings surprise of 51.77%, over the last four quarters. You can see the complete list of today's Zacks #1 Rank stocks here .

Honeywell International Inc. HON currently carries a Zacks Rank #2 (Buy). The company delivered an average positive earnings surprise of 2.44%, in the trailing four quarters.

Advance Auto Parts, Inc. AAP also has a Zacks Rank of 2. The company came up with an average positive earnings surprise of 9.86%, during the same time frame.

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


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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