BCV Bulletin - Recent Trading Activity - May 2024
REDUCE: Raytheon Technologies (NYSE: RTX)
We are reducing our position in Raytheon Technologies (RTX). RTX is a large industrial company with three primary business segments including Pratt & Whitney, Collins Aerospace, and Raytheon which operates in aerospace and defense end-markets. It is our current intention to continue holding RTX over the long-term given its attractive commercial aerospace exposure. Pratt & Whitney and Collins Aerospace have attractive backlogs and a large installed base of products which we believe will generate decades of after-market growth. However, we see shorter-term risks to valuation as the company works through an accelerated fleet inspection on their PW1100G-JM engines as a result of a rare condition identified in some of the engine's metal components. While we are confident the company will resolve this issue over the next several years, given RTX’s present valuation we feel it is prudent to reduce our position size in client investment accounts.
BUY: Accenture (NYSE: ACN)
Accenture plc (ACN) is a global leader in professional services and digital transformation. ACN's dominant market position, diverse revenue streams, and extensive industry expertise make it a go-to partner, for transformative solutions in managed services and consulting. Over the long term, Accenture is poised to benefit from cloud adoption and modernization, growth through generative artificial intelligence, and technological innovation. They should continue to outgrow the information technology and business services industry through market share gains. Given the company’s history of strong cash flow generation, dividend growth, and financial discipline, we believe the current valuation presents a good investment entry point opportunity.
Notice to Readers: This BCV Bulletin is prepared for general informational purposes only, without reference to the investment objectives, financial profile, or risk tolerance of any specific person or entity who may receive it. Investors should seek professional financial advice regarding the appropriateness of investing in any investment strategy or security and no financial decisions should be made based on the information provided in this document. Statements regarding future performance may not be realized and past performance is not a guarantee of future performance. This document and its contents do not constitute a recommendation or solicitation to buy or sell securities of any kind. Investors should note that income, if any, from any investment strategy or security may fluctuate and that portfolio values may rise or fall. BCV Asset Management Inc. does not guarantee the accuracy or completeness of the information contained herein, nor does BCV Asset Management Inc. assume any liability for any loss that may result from the reliance by any person upon any such information or opinions. The information and opinions contained herein are subject to change without notice.
