Is It The Right Time To Buy United Technologies Corporation (NYSE:UTX)?

United Technologies Corporation (NYSE:UTX) saw significant share price volatility over the past couple of months on the NYSE, rising to the highs of $130.15 and falling to the lows of $117.7. This high level of volatility gives investors the opportunity to enter into the stock, and potentially buy at an artificially low price. A question to answer is whether United Technologies's current trading price of $125.05 reflective of the actual value of the large-cap? Or is it currently undervalued, providing us with the opportunity to buy? Let’s take a look at United Technologies’s outlook and value based on the most recent financial data to see if there are any catalysts for a price change. View out our latest analysis for United Technologies

What is United Technologies worth?

According to my valuation model, United Technologies seems to be fairly priced at around 11.8% above my intrinsic value, which means if you buy United Technologies today, you’d be paying a relatively fair price for it. And if you believe the company’s true value is $111.86, there’s only an insignificant downside when the price falls to its real value. So, is there another chance to buy low in the future? Given that United Technologies’s share is fairly volatile (i.e. its price movements are magnified relative to the rest of the market) this could mean the price can sink lower, giving us an opportunity to buy later on. This is based on its high beta, which is a good indicator for share price volatility.

What does the future of United Technologies look like?

Investors looking for growth in their portfolio may want to consider the prospects of a company before buying its shares. Buying a great company with a robust outlook at a cheap price is always a good investment, so let’s also take a look at the company's future expectations. With profit expected to grow by 54.95% over the next couple of years, the future seems bright for United Technologies. It looks like higher cash flows is on the cards for the stock, which should feed into a higher share valuation.

What this means for you:

Are you a shareholder? UTX’s optimistic future growth appears to have been factored into the current share price, with shares trading around its fair value. However, there are also other important factors which we haven’t considered today, such as the track record of its management team. Have these factors changed since the last time you looked at the stock? Will you have enough conviction to buy should the price fluctuates below the true value?

Are you a potential investor? If you’ve been keeping tabs on UTX, now may not be the most advantageous time to buy, given it is trading around its fair value. However, the optimistic prospect is encouraging for the company, which means it’s worth diving deeper into other factors such as the strength of its balance sheet, in order to take advantage of the next price drop.

Price is just the tip of the iceberg. Dig deeper into what truly matters – the fundamentals – before you make a decision on United Technologies. You can find everything you need to know about United Technologies in the latest infographic research report. If you are no longer interested in United Technologies, you can use our free platform to see my list of over 50 other stocks with a high growth potential.

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Simply Wall St analyst Simply Wall St and Simply Wall St have no position in any of the companies mentioned. This article is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.