Honeywell International Inc. ( HON Quick Quote HON - Free Report) has reported better-than-expected fourth-quarter 2020 results, wherein both earnings and revenues surpassed estimates. Earnings & Revenues
Adjusted earnings were $2.07 per share, surpassing the Zacks Consensus Estimate of $2.00. Moreover, the bottom line was up 0.5% year over year.
In 2020, the company’s adjusted earnings came in at $7.10, down 13% year over year. Honeywell’s fourth-quarter revenues were $8,900 million, surpassing the consensus estimate of $8,358 million. The top line fell 6% year over year on a reported basis and 7% on an organic basis, owing to weakness in end markets due to the coronavirus outbreak-led issues. In 2020, the company’s revenues were $32,637 million, down 11% on a year-over-year basis. Segmental Breakup
Aerospace’s quarterly revenues were $2,978 million, down 19% year over year. Honeywell Building Technologies’ revenues declined 3% to $1,426 million. Performance Materials and Technologies’ revenues totaled $2,556 million, down 11%, while that for Safety and Productivity Solutions increased 28% to $1,940 million.
The company’s total cost of sales in the reported quarter was $5,976 million, down 5.6% year over year. Selling, general and administrative expenses declined 15.3% to $1,248 million. Interest expenses and other financial charges were $95 million compared with $91 million a year ago.
Operating income margin in the fourth quarter was 18.8%, up 100 basis points year over year. Balance Sheet/Cash Flow
Exiting 2020, Honeywell had cash and cash equivalents of $14,275 million compared with $9,067 million as of Dec 31, 2019. Long-term debt was $16,342 million, higher than $11,110 million recorded at the end of 2019.
In 2020, the company generated $6,208 million in cash from operating activities compared with $6,897 million a year ago. Capital expenditure was $906 million compared with $839 million incurred in 2019. Adjusted free cash flow in the quarter was $2,491 million, up 8.7% year over year. Outlook
Honeywell provided guidance for full-year 2021. For the year, the company anticipates earnings to be in the range of $7.60 to $8.00 per share, suggesting 9.9% year-over-year improvement at the mid-point. It anticipates revenues to be between $33.4 billion and $34.4 billion, with organic revenues expected to be up 1-4%.
For 2021, it also expects operating cash flow in the range of $5.7 billion to $6.1 billion, and free cash flow to be between $5.1 billion and $5.5 billion. Zacks Rank & Stocks to Consider
The company currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks are AGCO Corporation ( AGCO Quick Quote AGCO - Free Report) , AptarGroup, Inc. ( ATR Quick Quote ATR - Free Report) and Danaher Corporation ( DHR Quick Quote DHR - Free Report) . While AGCO currently sports a Zacks Rank #1 (Strong Buy), AptarGroup and Danaher carry a Zacks Rank #2 (Buy). You can see . the complete list of today’s Zacks #1 Rank stocks here AGCO delivered a positive earnings surprise of 434.48%, on average, in the trailing four quarters. AptarGroup delivered a positive earnings surprise of 10.91%, on average, in the trailing four quarters. Danaher delivered a positive earnings surprise of 19.86%, on average, in the trailing four quarters. The Hottest Tech Mega-Trend of All
Last year, it generated $24 billion in global revenues. By 2020, it's predicted to blast through the roof to $77.6 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.
See Zacks' 3 Best Stocks to Play This Trend >>