UTX has four principal operating segments: Otis (elevators and escalators), Carrier (heating, ventilating & air conditioning systems), Pratt & Whitney (aircraft engines and space propulsion), Flight Systems (helicopters electrical systems). For the 9 months ended 9/30/00, revenues rose 13% to $19.82B. Net income from cont. ops. applicable to Common rose 79% to $1.36B. Results reflect a strong performance from Carrier & higher operating margins.

December 5, 2000

United Technologies is a difficult stock to classify. Is it a momentum stock? Is it a value stock? Is it a growth stock? Is it a cyclical stock? Arguments can be made that this DOW component possesses characteristics of all four groups. This fact can only help the stock as it attracts a wide range of investors. UTX is trading near its all-time highs and yet only sports a P/E of 25.46. Although the company has a consistent history of splitting its stock, it usually does not do so until the stock is comfortably in triple digits. Obviously UTX is not there yet. For 2001, UTX expects earnings growth of about 15%. The current rally is approaching critical resistance at the all time high of $75.97 established in May 1999. A break above this double-top resistance could result in a substantial move. To that end, the Money Flow and OBV are rising, the MACD is positive and the RSI has more room to move before an overbought condition is signaled. If all of these technical indicators stay in line, UTX just may have enough strength to reach historical split levels.

December 7, 2000

Despite its name, UTX is not a true "technology" stock. This DOW component is known for its heavy industries such as, Otis Elevator, Carrier environmental control systems, Pratt & Witney aircraft engines and Sikorsky helicopters. UTX would be a beneficiary of any positive change in Fed policy. Market participants are becoming more optimistic that the Fed will soon turn to a neutral bias and eventually start cutting rates early next year. The current share price is not at split levels. However, when UTX reports earnings in mid-January, the Company is expected to post profits that are 18.6% higher than the same quarter a year ago. Yesterday, UTX broke through double top resistance just below $76.00. The first top was established in May of 1999 and the second top just this week. This was a very bullish occurrence, even though the stock failed to follow through today due to overall market weakness. The new all-time high of $77.19 is now the short-term resistance, while the 5-dma of $73.94 should provide short-term support. Important indicators such as the MACD and Money Flow are quite bullish. As always, if our stop is not executed, we will exit this position just before the earnings release or just after a split is announced.

Picked on December 5th @ $75.88
Change since picked -0.57
Stop Loss @ $71.00