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Industrials Sector

Industrials Sector. Steve Barone Nick Brega Dustin Broughton Tim Duffany Peter Wall. Industry Overview. Fourth largest sector Market weight of 11.04% Beta of 1.04 Sector has outperformed the S&P 500 by 4.01% in the last 5 years. XLI vs. S&P 500. Strengths.

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Industrials Sector

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  1. Industrials Sector Steve Barone Nick Brega Dustin Broughton Tim Duffany Peter Wall

  2. Industry Overview • Fourth largest sector • Market weight of 11.04% • Beta of 1.04 • Sector has outperformed the S&P 500 by 4.01% in the last 5 years

  3. XLI vs. S&P 500

  4. Strengths • Expansion of international economy • Population growth rate • Natural disasters • Need for defense • Diversified businesses • Technology innovation

  5. Risks • Rising material prices • Oil prices • Competition • Government regulation • Economic conditions

  6. Industry Breakdown

  7. Industry by Weight As of October 05

  8. General Electric • Today General Electric is one of the largest conglomerates with a market cap of $364 billion dollars. • General Electric leads the industry in almost all the sectors it operates. • Since General Electric is such a large diverse conglomerate it is less prone to market risk

  9. 3M Co. • Undervalued at the time of purchase • Less prone to market risk due to diversification of business segments

  10. Honeywell International Inc. • Less prone to market risk due to diversification of business segments • At the time of purchase, Honeywell was receiving major contracts • 3rd quarter sales were up 8% and earnings were up 28%

  11. UPS • Transportation industry was undervalued • Strong earnings growth • Reduce in costs • New technology

  12. Deere & Co. • Natural disasters opportunities • Economic Development • Strategic geographic placement

  13. Southwest • Hedged fuel costs • Discount leader • Decrease in competition • Rebound of the airline industry

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