Recent Buy: September 12th, 2014
I continued to diversify my portfolio when I initiated a position in United Technologies (UTX) on Friday. I’m now a shareholder in 17 companies. I bought 14 shares for $108.21 each with a $6.95 commision for a total transaction amount of $1521.89. The trailing 12-month P/E is 17.5, and the forward one year P/E is 14.4. My initial dividend yield is 2.18%, compared to the 5 year average of 2.30%, and this purchase adds $33.04 to my annual forward dividends for a new 12 month total of $1,064.71.
United Technologies is a high-technology products and services company in the global aerospace and building systems industries. Each of their business segments are highly diversified. They have a solid competitive hand in so many areas: elevators, escalators, fire safety, security, building automation, heating, ventilation, air conditioning, refrigeration, military and commercial engines, aircraft engines, advanced helicopters, auxiliary and ground power units, small turbojet propulsion products and more. Nearly all of today’s aircraft rely on their systems and components.
They’ve been raising dividends for 19 years; however, like one my other industrial holdings John Deere (DE), they don’t raise them exactly every 4 quarters. Earnings per share has grown strong over the last decade as the company continues to grow organically and through acquisitions. Revenue climbed from $37,445 USD Mil in 2004 to $62,626 USD Mil in 2013. The 5 year dividend growth rate is 8.92%, and the current payout ratio is 37%.
Competitors include Boeing (BA), and General Electric (GE). I want to own GE eventually, and will most likely start a position soon, but I decided to get on board with UTX first. I’ve attached fast graphs of UTX and GE for comparison. For my settings, I selected a 21 year history and opted to reinvest dividends with an original investment of $1521.89.
I’ve also enjoyed a few articles on UTX lately:
Dividend Growth Investor posted a great write up over at Seeking Alpha called, “United Technologies: A Diversified Dividend Powerhouse To Consider.”
The Motley Fool posted an article called, “5 Things United Technologies Corporation’s Management Wants You to Know.”
What do you think of UTX vs GE? What’s on your watchlist lately?