WASHINGTON, DC (May 12, 2017) — U.S. Market Advisors Law Group PLLC announces that a class action lawsuit has been filed against United Technologies Corporation (“United Technologies” or the “Company”) (NYSE:UTX) and certain of its senior executives. The class action is on behalf of investors who purchased or otherwise acquired United Technologies securities, seeking to recover compensable damages caused by defendants’ violations of the Securities Exchange Act of 1934. The case has been filed in United States District Court for the Southern District of New York and docketed under 17-cv-03570.
If you are a shareholder who purchased United Technologies securities between April 21, 2015 and July 20, 2015 (“Class Period”), you have until July 11, 2017 to ask the Court to appoint you as Lead Plaintiff for the class. The Lead Plaintiff is a representative for absent members of the class. Investors do not need to seek appointment as Lead Plaintiff to share in any class recovery in this action. If you are a class member and there is a recovery for the class, you can share in that recovery as an absent class member. You may retain counsel of your choice to represent you in this action. To discuss this action, contact David P. Abel at email@example.com.
Allegations Against Rackspace
United Technologies is a manufacturer and servicer of high technology products, including aircraft components, elevators, escalators, air-conditioning units, and military-missile systems. The Company is organized into four businesses: (1) UTC Aerospace Systems (“UTAS”) , its aerospace parts unit; (2) Otis Elevator Co. (“Otis”), its elevator unit; (3) UTC Climate, Controls & Security, its heating and cooling systems unit; and (4) Pratt & Whitney, its aircraft engines unit.
UTAS provides aerospace parts and aftermarket service solutions for aircraft manufacturers, airlines, military customers, and business aviation companies. UTAS’ operating profits account for approximately 25 percent of United Technologies’ 2015 total operating profits. Otis manufactures, installs, and services elevators and escalators around the world. Otis’ operating profits account for approximately 40 percent of United Technologies’ 2015 total operating profits.
On December 11, 2014, United Technologies held its December Investor and Analyst Meeting. During that meeting, Defendant Hayes issued United Technologies’ 2015 earnings forecast range of $7.00 and $7.20 per share, falling short of analysts’ estimates. Despite the disappointing overall forecast, the Company expressed confidence in achieving the guidance, and supported their underlying assumptions in each business unit, including the UTAS and Otis units.
On January 26, 2015, United Technologies issued a press release in which it reported its full year 2014 financial results. In that same press release, the Company updated its earnings forecast from a range of 7.00 and $7.20 per share to $6.85 and $7.05 per share, but did so for reasons unrelated to the expected performance of UTAS and Otis. In fact, the Company affirmed that its forecasts with respect to these two business units were on track and realistic.
Throughout the Class Period, United Technologies issued and reaffirmed unfounded and inflated earnings guidance, primarily based on the planning assumptions in two of the Company’s key business units: UTAS and Otis. United Technologies ultimately acknowledged that these planning assumptions were not fully scrutinized and were far too aggressive.
The truth was finally revealed on July 21, 2015, when United Technologies cut its 2015 earnings guidance on the basis of weak performance by the UTAS and Otis units. During a related earnings conference call, Defendants revealed that, in their view, the assumptions relating to UTAS and Otis that formed the basis of the earnings guidance were “way too aggressive” and that the Company did not “dig deep enough” when the guidance was set.
On this news, United Technologies’ stock dropped $7.77 per share, or 7.03 percent, to close at $102.71 per share on July 21, 2015.
U.S. Market Advisors Law Group PLLC is a national law firm based in Washington, D.C. The firm represents investors worldwide in U.S. securities class action lawsuits.
David P. Abel