What to Expect From Honeywell Earnings

This big cap multinational announced this summer its largest purchase in more than a decade, when it agreed to buy the utility consumption metering business of Britain’s Melrose Industries for about $5.1 billion. This is the first major deal for Honeywell since it laid out a five-year plan in March 2014 to target at least $10 billion in acquisitions. Wall Street has been very eager to see how industrial companies use their capital as many of the foreign markets struggle for growth.

Honeywell’s operations are organized under three business groups: Aerospace, Automation & Control Solutions, and Performance Materials & Technologies. The company is a premier supplier of avionics, power and control systems for the aerospace industry. The UBS team loves the exposure the company has to the “energy efficiency” secular growth theme, where 50% of revenues are derived.

A few analysts weighed in on Honeywell ahead of its earnings release:

• Nomura has a Neutral rating but lowered its price target to $104 from $106.
• Morgan Stanley lowered its price target to $113 from $120.
• Cowen reiterated a Buy rating with a $116 price target.
• Barclays has an Overweight rating but lowered its price target to $102 from $118.
• Oppenheimer reiterated an Outperform rating with a $117 price target.

So far in 2015 Honeywell’s performance has been relatively flat. However, the stock is up roughly 16% over the past 52-weeks.

Shares of Honeywell were last trading at $97.97, with a consensus analyst price target of $113.74 and a 52-week trading range of $83.48 to $107.41.