Credit Suisse Sees Momentum Building for United Technologies Corporation

In a report published Friday, Credit Suisse analyst Julian Mitchell reiterated an Outperform rating and $138.00 price target on United Technologies Corporation UTX. In the report, Credit Suisse noted, "Following today's analyst meeting, we slightly lower our EPS ests; our TP remains $138. Overall, while organic trends (China BIS, UTAS comm'l AM) have started the year a little sluggishly (we were $0.06 below the Street for Q1, but have cut our estimate by another $0.03), we heard enough to give us encouragement that many of the strategic items we previewed in two recent reports are underway or are being set in motion (see inside). Aside from the strategic matters, we still see a path to double-digit EPS growth in 2016 (including a $0.20 tailwind from Pension, R&D and Share count), which should help drive a further re-rating of the shares. Next catalysts would include potential European demand acceleration, evidence that the working capital efforts at Aerospace are driving up FCF conversion, or an acquisition. UTX remains our preferred name among the large-cap conglomerates." United Technologies Corporation closed on Thursday at $121.24.