UTX upgraded for second time in a week

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    This one’s from Goldman so you know, “big league.”..

    We upgrade UTX to Buy from Neutral. We believe the GTF engine is reaching positive financial second derivative in its life cycle, and that will change the narrative for the stock. Given our view that UTX is now within the year of maximum new engine loss on GTF, we think the market will start looking beyond that peak loss and start giving greater consideration to the substantial longer run cash flows of the program and less to the upfront early losses. UTX trades near all time low valuation discounts to all of Multi-Industry, Aerospace and Elevator comp groups when stripping out the current GTF loss (but still assigning no value to positive out-year contributions). We think the market will increasingly look at the stock through that lens as 2018 progresses. Outside of the GTF, aerospace aftermarket and Defense end-market growth is accelerating, while Otis and CCS are stable, and the pending Collins deal and tax reform could both be accretive.

    `UTX

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