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Honeywell International Inc HON

Rating as of

Morningstar’s Analysis

Valuation
Currency in USD
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1-Star Price

PREMIUM

5-Star Price

PREMIUM

Economic Moat

PREMIUM

Capital Allocation

PREMIUM

Honeywell Has Multiple Growth-Opportunities and Remains a Best-in-Class Multi-Industrial

Joshua Aguilar Equity Analyst

Analyst Note

| Joshua Aguilar |

While Honeywell’s market value fell on the trading day, there wasn’t too much in the wide-moat firm’s second-quarter print to pick on, in our view. Therefore, we lift our fair value estimate by 4% to $211 per share from $203 previously, mostly because we now expect less personal safety revenue from respirator sales, which had a positive impact on our operating margin projections (for reference, we’re modeling segment operating profits margins of 21.1% for full-year 2021, at the top end of the range). While there were other minor puts and takes, the primary offset to our more bullish view was a higher U.S. corporate tax rate in 2022, in line Morningstar’s probability-adjusted view that the U.S. Congress will implement higher rates next year.

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Company Profile

Business Description

Honeywell traces its roots to 1885 with Albert Butz’s firm, Butz-Thermo Electric Regulator, which produced a predecessor to the modern thermostat. Today, Honeywell is a global multi-industry behemoth with one of the largest installed bases of equipment. The firm operates through four business segments, including aerospace, building technologies, performance materials and technologies, and safety and productivity solutions. In recent years, the firm has made several portfolio changes, including the addition of Intelligrated in 2016, as well as the spins of Garrett Technologies and Resideo in 2018. In 2019, the firm launched Honeywell Forge, its enterprise performance management software solution that leverages the firm's domain expertise in buildings, airlines, and critical infrastructure.

Contact
300 South Tryon Street
Charlotte, NC, 28202
T +1 704 627-6200
Sector Industrials
Industry Specialty Industrial Machinery
Most Recent Earnings Jun 30, 2021
Fiscal Year End Dec 31, 2021
Stock Type Cyclical
Employees 103,000

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