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This stock could get shutdown by the government

Talking Numbers

With 17.5% of its revenues coming from the US government, should a shutdown be a reason to avoid United Technologies’ stock?

As the government shutdown continues, it’s not just 800,000 federal government workers who are being furloughed. One major defense contractor says 5,000 of its employees may also be asked not to show up to work, too.

United Technologies isn’t just the parent company of Carrier refrigerators and Otis elevators. The Connecticut-based company is also behind Sikorsky helicopters and Pratt & Whitney aircraft engines.

If an agreement isn’t reached by this coming Sunday, about 2,000 Sikorsky employees will be furloughed and an additional 2,000 workers at Pratt & Whitney will follow shortly thereafter. A total of about 5,000 workers will be out on the street should the shutdown continue for weeks.

(Read: Boehner tells Republicans he won’t let the nation default)

While that’s a small fraction of United Technologies’ workforce of 218,300, the US government is the company’s biggest customer. Out of United Technologies’ $57.7 billion revenues in 2012, $10.1 billion came from sales to Uncle Sam. The defense contractor manufactures Blackhawk and Seahawk helicopters as well as jet engine parts and threat detection systems.

With 17.5% of its revenues coming from the US government, should a shutdown be a reason to avoid United Technologies’ stock?

(Read: Pentagon's $5.5 billion shutdown spending spree)

Looking at United Technologies’ fundamentals is John Stephenson, portfolio manager at First Asset Investment Management. Analyzing the charts for the stock is Steven Pytlar, Chief Equity Strategist at Prime Executions.

Should you invest in United Technologies? Watch the video to see what the fundamentals and technicals have to say about it.

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