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Honeywell (HON) to Combine Quantum Solutions Unit With CQC
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Honeywell International Inc. (HON - Free Report) recently announced its decision to combine its Quantum Solutions business with Cambridge Quantum Computing (“CQC”). Notably, the transaction is anticipated to create the biggest standalone quantum computing company in the world.
The company’s shares jumped 0.7% yesterday, ending the trading session at $229.81.
Founded in 2014, CQC is a leading independent quantum computing software company, with presence across the United States, Japan and Europe. It is engaged in designing tools, with a focus on commercialization of quantum technologies.
Inside the Headlines
As noted, the new company will be capable of offering the best performing quantum computer along with a complete suite of quantum software. The technologies will serve customer requirements for enhanced computation in several fields like drug discovery and delivery, cyber security, material science as well as finance.
On completion of the transaction, the ownership of majority stake in the new company will be with Honeywell. Along with an investment of $270-$300 million into the new company, Honeywell is also expected to enter into a long-term deal to facilitate the production of critical ion traps required for powering the quantum hardware.
Notably, the merger is anticipated to close in third-quarter 2021, subject to customary closing conditions and regulatory approvals. Honeywell did not modify its financial outlook for 2021, on account of the transaction.
Zacks Rank, Price Performance and Estimate Trend
Honeywell, with a $159.6-billion market capitalization, currently carries a Zacks Rank #3 (Hold). Strength in the company’s defense and space business, supported by stable U.S. government defense budgets, is likely to act as a tailwind in the quarters ahead. For 2021, it anticipates organic growth in the defense and space business to be flat to up in low-single digits. Also, signs of recovery in business aviation aftermarket bode well. However, weakness across the commercial aerospace end market might adversely impact its near-term performance.
In the past three months, the company’s shares have gained 8% compared with the industry’s growth of 8.9%.
Image Source: Zacks Investment Research
In the past 30 days, the Zacks Consensus Estimate for the company’s earnings has moved up 0.3% to $8.01 for 2021, while the same for 2022 has been raised 0.7% to $9.12.
Griffon delivered an earnings surprise of 50.00% in the last reported quarter.
ITT delivered an earnings surprise of 21.84% in the last reported quarter.
Macquarie delivered an earnings surprise of 25.00% in the last reported quarter.
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Image: Bigstock
Honeywell (HON) to Combine Quantum Solutions Unit With CQC
Honeywell International Inc. (HON - Free Report) recently announced its decision to combine its Quantum Solutions business with Cambridge Quantum Computing (“CQC”). Notably, the transaction is anticipated to create the biggest standalone quantum computing company in the world.
The company’s shares jumped 0.7% yesterday, ending the trading session at $229.81.
Founded in 2014, CQC is a leading independent quantum computing software company, with presence across the United States, Japan and Europe. It is engaged in designing tools, with a focus on commercialization of quantum technologies.
Inside the Headlines
As noted, the new company will be capable of offering the best performing quantum computer along with a complete suite of quantum software. The technologies will serve customer requirements for enhanced computation in several fields like drug discovery and delivery, cyber security, material science as well as finance.
On completion of the transaction, the ownership of majority stake in the new company will be with Honeywell. Along with an investment of $270-$300 million into the new company, Honeywell is also expected to enter into a long-term deal to facilitate the production of critical ion traps required for powering the quantum hardware.
Notably, the merger is anticipated to close in third-quarter 2021, subject to customary closing conditions and regulatory approvals. Honeywell did not modify its financial outlook for 2021, on account of the transaction.
Zacks Rank, Price Performance and Estimate Trend
Honeywell, with a $159.6-billion market capitalization, currently carries a Zacks Rank #3 (Hold). Strength in the company’s defense and space business, supported by stable U.S. government defense budgets, is likely to act as a tailwind in the quarters ahead. For 2021, it anticipates organic growth in the defense and space business to be flat to up in low-single digits. Also, signs of recovery in business aviation aftermarket bode well. However, weakness across the commercial aerospace end market might adversely impact its near-term performance.
In the past three months, the company’s shares have gained 8% compared with the industry’s growth of 8.9%.
In the past 30 days, the Zacks Consensus Estimate for the company’s earnings has moved up 0.3% to $8.01 for 2021, while the same for 2022 has been raised 0.7% to $9.12.
Key Picks
Some better-ranked stocks from the same space are Griffon Corporation (GFF - Free Report) , ITT Inc. (ITT - Free Report) and Macquarie Infrastructure Company , each carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Griffon delivered an earnings surprise of 50.00% in the last reported quarter.
ITT delivered an earnings surprise of 21.84% in the last reported quarter.
Macquarie delivered an earnings surprise of 25.00% in the last reported quarter.
Infrastructure Stock Boom to Sweep America
A massive push to rebuild the crumbling U.S. infrastructure will soon be underway. It’s bipartisan, urgent, and inevitable. Trillions will be spent. Fortunes will be made.
The only question is “Will you get into the right stocks early when their growth potential is greatest?”
Zacks has released a Special Report to help you do just that, and today it’s free. Discover 7 special companies that look to gain the most from construction and repair to roads, bridges, and buildings, plus cargo hauling and energy transformation on an almost unimaginable scale.
Download FREE: How to Profit from Trillions on Spending for Infrastructure >>