I don't think there is any uncertainty to a buyback; they have announced exactly that action. They will be buying bargain stock, it appears.
it appears that UTC is cutting across the board. I was terminated end of June after 15 years. No big loss, I'll retire and have already started consulting.
Maybe it is time for Kangas to go join Louie on the yacht? If he is too busy to be responsible as Chairman at UTC, time to relieve him of a few of his many duties!
Personally I'd rather see the spin-off. Not sure I'd want to hold SIK stock, but I'd have the opportunity to decide after the deal is done. In a sale, the proceeds would fall upward I fear, not equally across the board.
You can ALWAYS bail, if you choose to do so. You may not be able to retire in the style that Kid would have us emulate, but you can bail.
Both the 380 and the 747 are dinosaurs it seems. I've yet to fly on a 787, but people I know who have said "nice plane" ... I've flown 747 & 380, and while the 380 is nice, unless you're in the front, the mob infront of you upon landing is too big for my taste.
Quoting Kid: " I still don't like paying more taxes than GE.........Kid"
I don't either, but I can't afford the army of lobbyists and accountants and lawers that GE keeps employed.
most of MY GE was purchased at $9.25; slowly regaining price so I'm not complaining; ~3.5% dividend yield too; even BIK would approve.
MY uninformed GUESS is that SIK will be a spin off; shareholders will get some fractional value of each UTX share as a share of new SIK. I base that guess on the tax implications if there is an outright sale. So if you really believe in SIK over UTX, convert your UTX sharess post spin to on the market shares of SIK. Or shift some precentage if you are not 100% convinced. Seems that Hayes' aproach is to pump the oveall UTX earnings potential by removing the low margin businesses one way or another. We'll see.
I am a long term holder; I also do some medium term trading in & out. Looking at the UTX fundamentals, it seems to me to be a good investment. Are there better? Yes, I'm sure there are. Are there worse? Certainly. You do your own DD.
Kid, I hope you're around 50 years from now to summarize what a great engine the GTF series became! I presume they don't call you "KID" for nothing.
Nice writeup, Kid, but I for one am quite glad that Pratt, or especially only one engine series, are no longer the main profit drivers for UTC. According to last years Annual, Otis leads the pack (Profit / Sales = 20.3%); CCS lead if you figure total segment profit/total UTC sales (27.8%). The combined BIS segment is the gorilla in the room now, generating 54+% of UTC profits. The relative rankings will shift up and down over the years, as business conditions change and the whole of UTC evolves to meet those changes. Unless everything turns to solid #$%$ at once, some piece of the pie will do well, I anticipate.
I'm not an aircraft or engine person, but it SEEMS to me that gearing is something Pratt has done for years (helicopter rotors run off of gear boxes, as do many other accessory items on the main engine). I presume that the GTF gearing is super precise and super robust by aircraft standards (we aren't building steam turbines after all). I'll also presume that the testing for the gearboxes is way down the life-cycle with more than enough data to have good L-10 and MTBF data. Now I could be wrong, in which case, OUCH is an understatement. But I'm also presuming that Pratt & UTC are mature enough to have worked through the various fault trees and test protocols such that the surprises will be little ones. We may be 10 years to know the full story; if it takes that long we are successful!
Seems to me (and I'm not an analyst) that if the combination is worth $145 and the split is worth $145, the only value created is for the investment bankers who will pocket millions in fees for such a transaction. The benefit of a mixed portfolio of assets ALA UTX is that when one segment is slower another might be pouring out cash. Who funded the Pure Power R&D, for example? It wasn't all P&W; I'm sure.