On Aug 23, we updated the research report on industrial goods manufacturer, Honeywell International Inc. (HON - Free Report) .
With a flexible yet disciplined focus on cost and productivity, Honeywell aims at increasing its presence in high-growth regions. Population growth, urbanization and infrastructure development continue to create attractive opportunities across its entire portfolio. The company’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. Additionally, the company is building a robust pipeline of new products.
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. The focused approach bodes well for Honeywell’s growth in 2017.
The company has outperformed the industry with an average year-to-date return of 18.2% against a decline of 3% for the latter. 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 positives amid a challenging macroeconomic environment.
However, Honeywell expects a tepid demand pattern for its business jets and mobile scanners in 2017 due to sluggish global growth, volatility in crude oil prices and a tempered Chinese economy. Consequently, the company projects 2017 earnings in the range of $6.90-$7.10 per share while revenues are anticipated to be down 1% to up 2% year over year. Although the company’s proactive restructuring initiatives have positioned it to navigate better than many of its peers, it is yet to witness signs of stabilization in a number of its major end markets. A change in the U.S. government’s defense and aerospace funding could also adversely impact sales of Aerospace’s products and services. The high research and development costs could also be a drag on the Aerospace segment margin and affect its profitability.
Nevertheless, we remain impressed with the inherent growth potential of this Zacks Rank #3 (Hold) stock. Better-ranked stocks in the industry include Barnes Group Inc. (B - Free Report) , Graco Inc. (GGG - Free Report) and RBC Bearings Incorporated , each carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Barnes has a long-term earnings growth expectation of 9%.
Graco has a long-term earnings growth expectation of 10.5%. It topped estimates in each of the trailing four quarters with an average positive earnings surprise of 23.95%.
RBC Bearings has a long-term earnings growth expectation of 8.4%. It topped estimates in each of the trailing four quarters with an average positive earnings surprise of 4.71%.
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From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
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On Aug 23, we updated the research report on industrial goods manufacturer, Honeywell International Inc. (HON - Free Report) .
With a flexible yet disciplined focus on cost and productivity, Honeywell aims at increasing its presence in high-growth regions. Population growth, urbanization and infrastructure development continue to create attractive opportunities across its entire portfolio. The company’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. Additionally, the company is building a robust pipeline of new products.
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. The focused approach bodes well for Honeywell’s growth in 2017.
The company has outperformed the industry with an average year-to-date return of 18.2% against a decline of 3% for the latter. 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 positives amid a challenging macroeconomic environment.
However, Honeywell expects a tepid demand pattern for its business jets and mobile scanners in 2017 due to sluggish global growth, volatility in crude oil prices and a tempered Chinese economy. Consequently, the company projects 2017 earnings in the range of $6.90-$7.10 per share while revenues are anticipated to be down 1% to up 2% year over year. Although the company’s proactive restructuring initiatives have positioned it to navigate better than many of its peers, it is yet to witness signs of stabilization in a number of its major end markets. A change in the U.S. government’s defense and aerospace funding could also adversely impact sales of Aerospace’s products and services. The high research and development costs could also be a drag on the Aerospace segment margin and affect its profitability.
Nevertheless, we remain impressed with the inherent growth potential of this Zacks Rank #3 (Hold) stock. Better-ranked stocks in the industry include Barnes Group Inc. (B - Free Report) , Graco Inc. (GGG - Free Report) and RBC Bearings Incorporated , each carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Barnes has a long-term earnings growth expectation of 9%.
Graco has a long-term earnings growth expectation of 10.5%. It topped estimates in each of the trailing four quarters with an average positive earnings surprise of 23.95%.
RBC Bearings has a long-term earnings growth expectation of 8.4%. It topped estimates in each of the trailing four quarters with an average positive earnings surprise of 4.71%.
4 Surprising Tech Stocks to Keep an Eye on
Tech stocks have been a major force behind the market’s record highs, but picking the best ones to buy can be tough. There’s a simple way to invest in the success of the entire sector. Zacks has just released a Special Report revealing one thing tech companies literally cannot function without. More importantly, it reveals 4 top stocks set to skyrocket on increasing demand for these devices. I encourage you to get the report now – before the next wave of innovations really takes off.
See Stocks Now>>
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
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