UNITED TECHNOLOGIES STOCK ANALYSIS: More than just AEROSPACE


Yesterday, I talked about the Raytheon-United Technologies merger from the side of $RTN . Today, let's look at $UTX . The company is a conglomerate of 4 subsidiaries: 1. Pratt & Whitney which makes aircraft engines and is the main competitor of $GE Aviation and $RR.L 2. Collins Aerospace which makes aircraft parts 3. Otis, the leading maker of elevators in the world 4. Carrier which is involved in heating and refrigeration

$UTX is going to spin-off Otis and Carrier into two different companies and then merge with $RTN to form Raytheon Technologies which will be the second largest aerospace company in the world behind $BA and ahead of $LMT . It will also be the third largest defense contractor after $LMT and $BA .

This merger, however, will reduce competition in the industry and eventually innovation. It will be an interesting industry to follow for the coming years. Usually when innovation dies smaller companies grow and will displace the old ones. It happened with tech, $IBM $XRX and $HPQ became too big and were not innovating anymore. They were eventually replaced by $AAPL and $MSFT . The same thing can happen in the defense and aerospace industry.

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