View
213
Download
0
Category
Tags:
Preview:
Citation preview
Michael BeardshawJeremy SchubertCharles Heldridge
Lucas Mendoza
United Technologies• Founded in 1929 as a response to Boeing– Headquarters – Hartford, CT
• Employs 212,000 people• Market Cap: $89.05 B• Creates – helicopters, aircraft engines– elevators and escalators, fuel cells, HVAC
• Hybrid inventory valuation– Primarily FIFO, some subsidiaries use LIFO
Honeywell• Founded in 1904 by Mark Honeywell
– Headquarters – Morristown, NJ• Employs 132,000 people worldwide• Market Cap: $75.24 B• Currently operates in
– Operates and creates aerospace and defense products – Smart technology control systems – Chemical products for the pharmaceutical industry– Efficiency production products for the automotive industry
• Hybrid inventory valuation– Some subsidiaries use LIFO
Boeing• Founded in 1916 – Headquarters – Chicago , Illinois
• Employs 169,000 people worldwide• Market Cap: $96.17 B• Currently operates in– Aerospace and defense, commercial airplanes,
helicopters, and air transportation– The defense industry is Boeing’s largest sector due to
the large line of defense products and services offered• Uses Weighted Average Inventory method
Common Size Income StatementCommon Size Income Statement
Boeing 2010
Boeing 2011
Boeing 2012
UTX 2010
UTX 2011
UTX 2012
Honeywell 2010
Honeywell 2011
Honeywell 2012
Sale Of Products 81.8% 83.5% 87.2% 71.1% 69.7% 70.6% 79.7% 78.7% 79.2%
Sale Of Services 18.2% 16.5% 12.8% 28.9% 30.3% 29.4% 21.3% 21.3% 20.9%
Total Revenue 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%
Cost of Products -65.6% -67.9% -73.8% -53.3% -52.5% -53.9% -62.0% -63.6% -60.9%
Cost of Services -14.8% -13.2% -10.0% -19.3% -19.9% -19.2% -14.4% -14.6% -14.2%
Capital Corporation Interest Expense -0.3% -0.2% -0.1% N/A N/A N/A N/A N/A N/A
Total Cost and Expenses -80.6% -81.3% -84.0% -72.6% -72.4% -73.0% -76.5% -78.2% -75.1%
Income from Operating Investments 0.4% 0.4% 0.3% 0.2% 1.0% 1.7% 0.3% 0.2% 0.2%
Administrative Expensive -5.7% -5.0% -4.5% -11.1% -11.1% -11.2% -14.1% -14.8% -13.9%
Research and Development -6.4% -5.7% -4.0% -3.2% -3.5% -4.1% N/A N/A N/A
Earnings from Operations 7.7% 8.5% 7.7% 13.2% 14.1% 13.3% 9.7% 7.3% 11.2%
Interest and Debt Expense -0.8% -0.7% -0.6% -1.2% -0.9% -1.3% -1.2% -1.0% -0.9%
Earnings before Income Tax 7.0% 7.9% 7.2% 12.0% 13.2% 12.0% 9.5% 6.2% 10.3%
Income Tax Expense -1.9% -2.0% -2.5% -3.4% -3.8% -3.0% -2.4% -1.1% -2.5%
Net Income 5.1% 5.9% 4.8% 8.7% 9.6% 9.5% 6.1% 5.7% 7.8%
Common Size Balance Sheet
Revenue by Segment
Major Segments:Aerospace - 5% steady annual growth expected Defense - in decline due to decreasing demand Commercial Aircraft - increased growth rate projected, perhaps over 10%Control Solutions – Security systems, climate control, other automated systemsHuman Transportation – elevators, escalators, etc.
Revenue by Segment
33%
43%
15%
10% 31%
43%
16%
11%32%
42%
16%
10%
Aerospace
Automation and Control Solu-tions
Performance Materials and Technology
Transportation Systems
Honeywell
50%
1%
50%
0%
53%
1%
47%
0%
60%
1%
40%
0%
Commerical Airplanes
Boeing Capital Corporation
Defense, Space & Security
Other Segments
Boeing
22%
34%23%
8%13%
22%
34%
23%
8%
13%21%
29%24%
14%
12%
Otis
UTC Climate, Controls & Security
Pratt & Whitney
UTC Aerospace Systems
Sikorsky
United Technologies
Liquidity
Debt
Profitability
BA 2010 BA 2011 BA 2012 UTX 2010 UTX 2011 UTX 2012 HON 2010 HON 2011 HON 20120.00%
5.00%
10.00%
15.00%
20.00%
25.00%
30.00%
35.00%
40.00%
5.14% 5.85% 4.77%
8.67% 9.24% 9.01%6.06% 5.66%
7.77%
19.63% 18.91%
16.42%
27.45% 27.56% 26.95%
23.53%21.83%
24.89%Gross Profit MarginNet Profit Margin
Investor Analysis
HON BA UTX0.0%
10.0%20.0%30.0%40.0%50.0%60.0%70.0%80.0%
Percentages of Earnings Retained
201020112012
HON BA UTX1.00
1.05
1.10
1.15
1.20
Degree of Financial Leverage
201020112012
HON BA UTX0.0%
10.0%20.0%30.0%40.0%50.0%60.0%70.0%
Dividend Payout
201020112012
HON BA UTX0.0%
10.0%
20.0%
30.0%
40.0%
50.0%
60.0%
Dividend Yield
201020112012
HON BA UTX0.0
5.0
10.0
15.0
20.0
25.0
30.0
P/E Ratio
201020112012
Recommendation
1. Favorable key ratios: • Quick, Current ratios• Debt ratio• ROA, ROI, ROE• P/E ratio
2. Dividends• Dividend Payout, Yield
3. Diversification is a major strength• Controls, Aerospace, Transportation
Post-Period
Recommended