Honeywell International Inc. (HON - Free Report) reported mixed fourth-quarter 2021 results, wherein earnings surpassed estimates but revenues lagged the same.
Earnings & Revenues
Adjusted earnings came in at $2.09 per share, surpassing the Zacks Consensus Estimate of $2.08. The bottom line increased 1% year over year.
In 2021, the company’s adjusted earnings totaled $8.06, up 13.5% from $7.10 in 2020.
Honeywell’s fourth-quarter revenues were $8,657 million, missing the consensus estimate of $8,741 million. The top line decreased 3% year over year on a reported basis and 2% on an organic basis. The decline was attributable to supply-chain constraints and a decline in COVID mask sales.
In 2021, the company’s net sales were $34,392 million, up 5% from $32,637 million in 2020.
Segmental Breakup
Coming to operating segments, Aerospace’s quarterly revenues were $2,896 million, down 3% year over year. Honeywell Building Technologies’ revenues decreased 2% to $1,404 million. Performance Materials and Technologies’ revenues totaled $2,605 million, up 2% while that for Safety and Productivity Solutions decreased 10% to $1,752 million.
Costs/Margins
The company’s total cost of sales in the reported quarter was $5,936 million, down 0.7% year over year. Selling, general and administrative expenses were $1,203 million, down 3.6%. Interest expenses and other financial charges were $80 million compared with $95 million a year ago.
Operating income in the fourth quarter was $1,518 million, down 9.4% on a year-over-year basis. The operating income margin was 17.5%, down 130 basis points.
Balance Sheet/Cash Flow
Exiting 2021, Honeywell had cash and cash equivalents of $10,959 million compared with $11,087 million in the previous quarter. Long-term debt was $14,254 million, lower than $14,346 million recorded at the end of the previous quarter.
In 2021, the company generated $6,038 million in cash from operating activities compared with $6,208 million in 2020. In 2021, capital expenditure was $895 million compared with $906 million incurred a year ago.
Free cash flow in the quarter was $2,593 million, up 4.1% year over year.
Guidance
Honeywell provided guidance for full-year 2022. The company anticipates earnings to be in the range of $8.40 to $8.70 per share, indicating 4-8% growth year over year. It anticipates revenues to be between $35.4 billion and $36.4 billion, with organic revenues expected to be up 4-7%.
For 2022, Honeywell expects operating cash flow in the range of $5.7 billion to $6.1 billion and free cash flow to be between $4.7 billion and $5.1 billion.
Zacks Rank & Stocks to Consider
The company currently carries a Zacks Rank #4 (Sell).
Some better-ranked companies are discussed below.
ITT Inc. (ITT - Free Report) presently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
It delivered a four-quarter earnings surprise of 10.63%, on average.
ITT’s earnings estimates decreased 0.2% for both 2021 (results are awaited) and 2022 in the past 30 days. Its shares have lost 7.2% in the past three months.
Carlisle Companies Incorporated (CSL - Free Report) presently carries a Zacks Rank #2. It delivered a four-quarter earnings surprise of 38.89%, on average.
In the past 30 days, Carlisle’s earnings estimates have been stable for 2021 (results are awaited) and increased 0.2% for 2022. CSL’s shares have lost 3.3% in the past three months.
Tempur Sealy International, Inc. (TPX - Free Report) presently carries a Zacks Rank #2. It came up with a four-quarter earnings surprise of 22.39%, on average.
Tempur Sealy’s earnings estimates have been stable for 2021 (results awaited) and 2022 in the past 60 days. TPX’s shares have lost 11.1% in the past three months.
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Honeywell International Inc. (HON - Free Report) reported mixed fourth-quarter 2021 results, wherein earnings surpassed estimates but revenues lagged the same.
Earnings & Revenues
Adjusted earnings came in at $2.09 per share, surpassing the Zacks Consensus Estimate of $2.08. The bottom line increased 1% year over year.
In 2021, the company’s adjusted earnings totaled $8.06, up 13.5% from $7.10 in 2020.
Honeywell’s fourth-quarter revenues were $8,657 million, missing the consensus estimate of $8,741 million. The top line decreased 3% year over year on a reported basis and 2% on an organic basis. The decline was attributable to supply-chain constraints and a decline in COVID mask sales.
In 2021, the company’s net sales were $34,392 million, up 5% from $32,637 million in 2020.
Segmental Breakup
Coming to operating segments, Aerospace’s quarterly revenues were $2,896 million, down 3% year over year. Honeywell Building Technologies’ revenues decreased 2% to $1,404 million. Performance Materials and Technologies’ revenues totaled $2,605 million, up 2% while that for Safety and Productivity Solutions decreased 10% to $1,752 million.
Costs/Margins
The company’s total cost of sales in the reported quarter was $5,936 million, down 0.7% year over year. Selling, general and administrative expenses were $1,203 million, down 3.6%. Interest expenses and other financial charges were $80 million compared with $95 million a year ago.
Operating income in the fourth quarter was $1,518 million, down 9.4% on a year-over-year basis. The operating income margin was 17.5%, down 130 basis points.
Balance Sheet/Cash Flow
Exiting 2021, Honeywell had cash and cash equivalents of $10,959 million compared with $11,087 million in the previous quarter. Long-term debt was $14,254 million, lower than $14,346 million recorded at the end of the previous quarter.
In 2021, the company generated $6,038 million in cash from operating activities compared with $6,208 million in 2020. In 2021, capital expenditure was $895 million compared with $906 million incurred a year ago.
Free cash flow in the quarter was $2,593 million, up 4.1% year over year.
Guidance
Honeywell provided guidance for full-year 2022. The company anticipates earnings to be in the range of $8.40 to $8.70 per share, indicating 4-8% growth year over year. It anticipates revenues to be between $35.4 billion and $36.4 billion, with organic revenues expected to be up 4-7%.
For 2022, Honeywell expects operating cash flow in the range of $5.7 billion to $6.1 billion and free cash flow to be between $4.7 billion and $5.1 billion.
Zacks Rank & Stocks to Consider
The company currently carries a Zacks Rank #4 (Sell).
Some better-ranked companies are discussed below.
ITT Inc. (ITT - Free Report) presently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
It delivered a four-quarter earnings surprise of 10.63%, on average.
ITT’s earnings estimates decreased 0.2% for both 2021 (results are awaited) and 2022 in the past 30 days. Its shares have lost 7.2% in the past three months.
Carlisle Companies Incorporated (CSL - Free Report) presently carries a Zacks Rank #2. It delivered a four-quarter earnings surprise of 38.89%, on average.
In the past 30 days, Carlisle’s earnings estimates have been stable for 2021 (results are awaited) and increased 0.2% for 2022. CSL’s shares have lost 3.3% in the past three months.
Tempur Sealy International, Inc. (TPX - Free Report) presently carries a Zacks Rank #2. It came up with a four-quarter earnings surprise of 22.39%, on average.
Tempur Sealy’s earnings estimates have been stable for 2021 (results awaited) and 2022 in the past 60 days. TPX’s shares have lost 11.1% in the past three months.
Just Released: Zacks Top 10 Stocks for 2024
Hurry – you can still get in early on our 10 top tickers for 2024. Hand-picked by Zacks Director of Research, Sheraz Mian, this portfolio has been stunningly and consistently successful. From inception in 2012 through November, 2023, the Zacks Top 10 Stocks gained +974.1%, nearly TRIPLING the S&P 500’s +340.1%. Sheraz has combed through 4,400 companies covered by the Zacks Rank and handpicked the best 10 to buy and hold in 2024. You can still be among the first to see these just-released stocks with enormous potential.
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