ITT's Bold Vision by Christopher C. Williams
Highlighted companies: ITT Corporation (ITT)
Summary: ITT is not the faltering company about which some other corporate chieftains have warned. ITT is the market leader in night-vision goggles for the military, boasts what is arguably the most comprehensive portfolio of pumps and valves for the treatment and transfer of clean and waste water, and is also the maker of motion-and-flow-control tools and electronic components. Defense electronics and services, its largest segment, contributes to 47% of revenue while water accounts for 30%. ITT revenues and EPS have experienced yearly double digit increases, and its stock has returned 17% a year since its December 1995 IPO. If ITT continues to gain share in its core high-demand markets profits should continue on a steady upward path for several years. The company has said it would increase its quarterly dividend by 27% next year, and has also indicated it would buy back 1-2% of the 187 million outstanding shares. Based on its solid operating costs and increased earnings, expected to jump at a faster pace than most other industrial companies, Chairman Steve Loranger's bullish view may actually be right.
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