UTX Reiterates 2013 Guidance
United Technologies Corp. (UTX), a diversified conglomerate, has reiterated its outlook for 2013 despite several positive developments and new contracts in its kitty. The company presently expects earnings to be in the range of $5.85 to $6.15 per share on sales of $64 billion to $65 billion. The current Zacks Consensus Estimates for 2013 earnings and revenue are pegged at $6.04 and $65 billion, respectively.
Pratt & Whitney, a division of United Technologies, recently won a 5-year Performance Based Logistics (:PBL) contract worth $300 million from the Republic of Korea relating to the F100 engines that power its Air Force fleet of Lockheed Martin F-16 fighters and Boeing F-15K fighters. According to the terms of the agreement, Pratt & Whitney will provide the requisite support for about 230 engines in the intermediate engine shops and at the depot level.
In addition, Embraer SA (ERJ), a leading aerospace company, selected the PurePower Geared Turbofan engine manufactured by Pratt & Whitney to power its new second generation E-Jet aircraft family. The engine uses an advanced gear system and a superior core that facilitates superior performance with reduced fuel consumption, low emission levels, and lesser noise. Consequently, Embraer expects these engines to curtail its operating costs as well as meet its environmental improvement targets once the E-jets become operational in 2018.
United Technologies is also reportedly set to win a huge contract worth $6.8 billion for 112 rescue helicopters from the U.S. Air Force, as most of its competitors have missed the deadline to submit the requisite bids. The multi-billion deal will likely provide a much-needed boost to the Sikorsky helicopter segment of the company. United Technologies do not envisage any material impact on its 2013 outlook from the Embraer deal.
Based in Hartford, Connecticut, United Technologies is a diversified company that provides a broad range of high-technology products and services to the global aerospace and building systems industries. The company also operates a central research organization that pursues technologies for improving the performance, energy efficiency and cost of its products and processes.
United Technologies currently has a Zacks Rank #3 (Hold). We have a long-term Neutral recommendation on the stock.
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