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Industrial goods manufacturer Honeywell International Inc. (HON - Free Report) recently debriefed investors about its earnings and sales expectations for the future quarters. At the same time, the company reiterated its guidance for the first quarter and full-year 2017.
The company expects healthy organic growth on the back of aggressive capital deployment for comprehensive R&D efforts and opportune mergers and acquisitions. Honeywell’s balanced mix of long- and short-cycle businesses, along with a decent organic growth in new products and expansion in high-growth regions augur well on a long-term perspective. With a flexible yet disciplined focus on cost and productivity, Honeywell aims to increase its presence in high-growth regions. Population growth, urbanization and infrastructure development continue to create attractive opportunities across its entire portfolio. Additionally the company is building a robust pipeline of new products.
Honeywell’s diversified business portfolio has the potential to earn consistent above-average returns and mitigate operating risks. The company’s diligent focus on working capital management, free cash flow generation and a conservative balance sheet remain key positive attributes amid a challenging macroeconomic environment. In addition, Honeywell has regularly fine-tuned its portfolio, having sold about 60 of its units (accounting for $7 billion in sales) since 2002 and acquiring another 90 companies contributing $14 billion in revenues over the same period. These factors bode well for Honeywell’s growth in 2017 and beyond.
The company has significantly outperformed the Zacks categorized Diversified Operations industry in 2016 with an average return of 11.8% compared with 6.7% gain for the latter. The company also exceeded the S&P's total shareowner return by 300 basis points during this period and looks well poised to outperform in 2017 as well.
For 2017, Honeywell reaffirmed its earnings per share guidance of $6.85–$7.10 (excluding pension mark-to-market expense), significantly up from $6.46 in 2016. For the first quarter of 2017, earnings are expected to be in the range of $1.60–$1.64 per share.
Hitachi has a long-term earnings growth expectation of 13% and is currently trading at a forward P/E of 13.4x.
Swire Pacific is currently trading at a forward P/E of 15.8x.
Barloworld has a long-term earnings growth expectation of 18.7% and is currently trading at a forward P/E of 11.0x.
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Honeywell (HON) Reiterates Q1 & Full-Year 2017 Guidance
Industrial goods manufacturer Honeywell International Inc. (HON - Free Report) recently debriefed investors about its earnings and sales expectations for the future quarters. At the same time, the company reiterated its guidance for the first quarter and full-year 2017.
The company expects healthy organic growth on the back of aggressive capital deployment for comprehensive R&D efforts and opportune mergers and acquisitions. Honeywell’s balanced mix of long- and short-cycle businesses, along with a decent organic growth in new products and expansion in high-growth regions augur well on a long-term perspective. With a flexible yet disciplined focus on cost and productivity, Honeywell aims to increase its presence in high-growth regions. Population growth, urbanization and infrastructure development continue to create attractive opportunities across its entire portfolio. Additionally the company is building a robust pipeline of new products.
Honeywell’s diversified business portfolio has the potential to earn consistent above-average returns and mitigate operating risks. The company’s diligent focus on working capital management, free cash flow generation and a conservative balance sheet remain key positive attributes amid a challenging macroeconomic environment. In addition, Honeywell has regularly fine-tuned its portfolio, having sold about 60 of its units (accounting for $7 billion in sales) since 2002 and acquiring another 90 companies contributing $14 billion in revenues over the same period. These factors bode well for Honeywell’s growth in 2017 and beyond.
The company has significantly outperformed the Zacks categorized Diversified Operations industry in 2016 with an average return of 11.8% compared with 6.7% gain for the latter. The company also exceeded the S&P's total shareowner return by 300 basis points during this period and looks well poised to outperform in 2017 as well.
For 2017, Honeywell reaffirmed its earnings per share guidance of $6.85–$7.10 (excluding pension mark-to-market expense), significantly up from $6.46 in 2016. For the first quarter of 2017, earnings are expected to be in the range of $1.60–$1.64 per share.
Honeywell currently has a Zacks Rank #3 (Hold). Some better-ranked stocks in the industry include Hitachi, Ltd. (HTHIY - Free Report) , Swire Pacific Limited (SWRAY - Free Report) and Barloworld Limited (BRRAY - Free Report) , each carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Hitachi has a long-term earnings growth expectation of 13% and is currently trading at a forward P/E of 13.4x.
Swire Pacific is currently trading at a forward P/E of 15.8x.
Barloworld has a long-term earnings growth expectation of 18.7% and is currently trading at a forward P/E of 11.0x.
The Best Place to Start Your Stock Search
Today, you are invited to download the full list of 220 Zacks Rank #1 "Strong Buy" stocks – absolutely free of charge. Since 1988, Zacks Rank #1 stocks have nearly tripled the market, with average gains of +26% per year. Plus, you can access the list of portfolio-killing Zacks Rank #5 "Strong Sells" and other private research. See these stocks free >>