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Honeywell (HON) to Report Q4 Earnings: What's in the Cards?
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Honeywell International Inc. (HON - Free Report) is scheduled to report fourth-quarter 2021 results on Feb 3, before the opening bell.
The company delivered an earnings surprise of 3.70%, on average, in the trailing four quarters, beating estimates on all occasions. Honeywell’s third-quarter 2021 adjusted earnings of $2.02 per share surpassed the Zacks Consensus Estimate of $2.01 by 0.50%.
Image Source: Zacks Investment Research
In the past three months, shares of the company have lost 7.5% compared with the industry’s decline of 10.5%.
Key Factors
Weakness in Honeywell’s defense and space business on account of moderating U.S. defense spend and lower international defense volumes is likely to have adversely impacted its Aerospace segment’s performance in the fourth quarter. Headwinds across the commercial aviation original equipment business, due to challenged original equipment build rates, are likely to have hurt the segment’s top line. However, strength in commercial aviation aftermarket business might have supported its top line. The Zacks Consensus Estimate for the Aerospace segment’s revenues for the fourth quarter is currently pegged at $2,908 million, indicating growth of 6.4% from the quarter-ago number but a decline of 2.4% from the year-ago reported figure.
The company’s Performance Materials and Technologies segment is likely to have benefited from strength in its UOP and advanced materials businesses. However, softness in its process solutions might have affected the segment’s revenues. The consensus estimate for Performance Materials and Technology’s revenues is pegged at $2,552 million, suggesting an increase of 1.7% from the previous quarter’s reported figure but a 0.2% decrease on a year-over-year basis.
Honeywell’s Safety and Productivity Solutions segment is anticipated to have gained from strong demand for warehouse and workflow solutions and productivity solutions and services. However, a low-demand environment in its personal protective equipment business might have hurt the segment’s performance. Also, supply chain constraints are likely to have played a spoilsport. The consensus mark for the segment’s revenues stands at $1,827 million, implying a decrease of 1.8% and 5.8% on a sequential and year-over-year basis, respectively.
Solid demand for building products and services is likely to have augmented its Building Technologies segment in the to-be-reported quarter. The consensus estimate for the segment’s revenues stands at $1,403 million, implying an increase of 2.4% sequentially but a fall of 1.6% year over year.
The company has been witnessing rising costs and operating expenses over time. In the third quarter, its cost of sales increased 6.7% year over year while selling, general and administrative expenses rose 4.4%. High costs might have adversely impacted its margin and profitability in the to-be-reported quarter as well. Also, it is expected to have incurred repositioning charges in the fourth quarter for executing restructuring programs. This is likely to have adversely impacted its earnings in the quarter.
The consensus estimate for the company’s fourth-quarter total revenues is currently pegged at $8,736 million, suggesting an increase of 3.1% sequentially but a 1.8% decrease year over year. The consensus estimate for earnings of $2.08 suggests an improvement of 3% and 0.5% on a sequential and year-over-year basis, respectively.
Earnings Whispers
According to our quantitative model, a stock needs to have the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or at least 3 (Hold) to increase the odds of an earnings beat.
You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
But that is not the case here, as we will see below.
Earnings ESP: Honeywell has an Earnings ESP of -0.06%.
Honeywell International Inc. Price and EPS Surprise
Zacks Rank: The company carries a Zacks Rank #4 (Sell).
Key Picks
Here are some companies you may want to consider, as our model shows that these have the right combination of elements to post an earnings beat this season:
The Zacks Consensus Estimate for ITT’s earnings is pegged at $1.05 per share for the fourth quarter of 2021. ITT’s shares have lost 4.3% in the past three months.
Carlisle Companies Incorporated (CSL - Free Report) has an Earnings ESP of +0.76% and a Zacks Rank of 2, currently.
The Zacks Consensus Estimate for Carlisle’s earnings is pegged at $2.62 per share for the fourth quarter of 2021. CSL’s shares have lost 1.1% in the past three months.
Expedia Group, Inc. (EXPE - Free Report) has an Earnings ESP of +4.64% and a Zacks Rank of 3, currently.
The Zacks Consensus Estimate for Expedia’s earnings is pegged at 97 cents per share for the fourth quarter of 2021. EXPE’s shares have gained 9.6% in the past three months.
Image: Bigstock
Honeywell (HON) to Report Q4 Earnings: What's in the Cards?
Honeywell International Inc. (HON - Free Report) is scheduled to report fourth-quarter 2021 results on Feb 3, before the opening bell.
The company delivered an earnings surprise of 3.70%, on average, in the trailing four quarters, beating estimates on all occasions. Honeywell’s third-quarter 2021 adjusted earnings of $2.02 per share surpassed the Zacks Consensus Estimate of $2.01 by 0.50%.
In the past three months, shares of the company have lost 7.5% compared with the industry’s decline of 10.5%.
Key Factors
Weakness in Honeywell’s defense and space business on account of moderating U.S. defense spend and lower international defense volumes is likely to have adversely impacted its Aerospace segment’s performance in the fourth quarter. Headwinds across the commercial aviation original equipment business, due to challenged original equipment build rates, are likely to have hurt the segment’s top line. However, strength in commercial aviation aftermarket business might have supported its top line. The Zacks Consensus Estimate for the Aerospace segment’s revenues for the fourth quarter is currently pegged at $2,908 million, indicating growth of 6.4% from the quarter-ago number but a decline of 2.4% from the year-ago reported figure.
The company’s Performance Materials and Technologies segment is likely to have benefited from strength in its UOP and advanced materials businesses. However, softness in its process solutions might have affected the segment’s revenues. The consensus estimate for Performance Materials and Technology’s revenues is pegged at $2,552 million, suggesting an increase of 1.7% from the previous quarter’s reported figure but a 0.2% decrease on a year-over-year basis.
Honeywell’s Safety and Productivity Solutions segment is anticipated to have gained from strong demand for warehouse and workflow solutions and productivity solutions and services. However, a low-demand environment in its personal protective equipment business might have hurt the segment’s performance. Also, supply chain constraints are likely to have played a spoilsport. The consensus mark for the segment’s revenues stands at $1,827 million, implying a decrease of 1.8% and 5.8% on a sequential and year-over-year basis, respectively.
Solid demand for building products and services is likely to have augmented its Building Technologies segment in the to-be-reported quarter. The consensus estimate for the segment’s revenues stands at $1,403 million, implying an increase of 2.4% sequentially but a fall of 1.6% year over year.
The company has been witnessing rising costs and operating expenses over time. In the third quarter, its cost of sales increased 6.7% year over year while selling, general and administrative expenses rose 4.4%. High costs might have adversely impacted its margin and profitability in the to-be-reported quarter as well. Also, it is expected to have incurred repositioning charges in the fourth quarter for executing restructuring programs. This is likely to have adversely impacted its earnings in the quarter.
The consensus estimate for the company’s fourth-quarter total revenues is currently pegged at $8,736 million, suggesting an increase of 3.1% sequentially but a 1.8% decrease year over year. The consensus estimate for earnings of $2.08 suggests an improvement of 3% and 0.5% on a sequential and year-over-year basis, respectively.
Earnings Whispers
According to our quantitative model, a stock needs to have the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or at least 3 (Hold) to increase the odds of an earnings beat.
You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
But that is not the case here, as we will see below.
Earnings ESP: Honeywell has an Earnings ESP of -0.06%.
Honeywell International Inc. Price and EPS Surprise
Honeywell International Inc. price-eps-surprise | Honeywell International Inc. Quote
Zacks Rank: The company carries a Zacks Rank #4 (Sell).
Key Picks
Here are some companies you may want to consider, as our model shows that these have the right combination of elements to post an earnings beat this season:
ITT Inc. (ITT - Free Report) has an Earnings ESP of +0.54% and a Zacks Rank #2 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for ITT’s earnings is pegged at $1.05 per share for the fourth quarter of 2021. ITT’s shares have lost 4.3% in the past three months.
Carlisle Companies Incorporated (CSL - Free Report) has an Earnings ESP of +0.76% and a Zacks Rank of 2, currently.
The Zacks Consensus Estimate for Carlisle’s earnings is pegged at $2.62 per share for the fourth quarter of 2021. CSL’s shares have lost 1.1% in the past three months.
Expedia Group, Inc. (EXPE - Free Report) has an Earnings ESP of +4.64% and a Zacks Rank of 3, currently.
The Zacks Consensus Estimate for Expedia’s earnings is pegged at 97 cents per share for the fourth quarter of 2021. EXPE’s shares have gained 9.6% in the past three months.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.