United Technologies (UTX) closed the most recent trading day at $149.57, moving -0.17% from the previous trading session. This change lagged the S&P 500’s 0.02% loss on the day. Elsewhere, the Dow lost 0.13%, while the tech-heavy Nasdaq added 0.08%.
Prior to today’s trading, shares of the maker of elevators, jet engines and other products had gained 1.56% over the past month. This has lagged the Conglomerates sector’s gain of 2.12% and the S&P 500’s gain of 3.81% in that time.
Wall Street will be looking for positivity from UTX as it approaches its next earnings report date. In that report, analysts expect UTX to post earnings of $1.84 per share. This would mark a year-over-year decline of 5.64%. Our most recent consensus estimate is calling for quarterly revenue of $19.33 billion, up 7.12% from the year-ago period.
Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $8.14 per share and revenue of $76.84 billion. These totals would mark changes of +6.96% and +15.55%, respectively, from last year.
It is also important to note the recent changes to analyst estimates for UTX. These revisions typically reflect the latest short-term business trends, which can change frequently. As a result, we can interpret positive estimate revisions as a good sign for the company’s business outlook.
Based on our research, we believe these estimate revisions are directly related to near-team stock moves. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.
The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection remained stagnant. UTX currently has a Zacks Rank of #2 (Buy).
In terms of valuation, UTX is currently trading at a Forward P/E ratio of 18.41. This represents a premium compared to its industry’s average Forward P/E of 17.53.
Also, we should mention that UTX has a PEG ratio of 2.09. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock’s expected earnings growth rate. Diversified Operations stocks are, on average, holding a PEG ratio of 2.23 based on yesterday’s closing prices.
The Diversified Operations industry is part of the Conglomerates sector. This group has a Zacks Industry Rank of 93, putting it in the top 37% of all 250+ industries.
The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.