Honeywell Slides By With Q4 Earnings

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When Honeywell International Inc. (NYSE: HON) reported its most recent quarterly results before the markets opened on Friday, the company posted $1.91 in earnings per share (EPS) and $9.73 billion in revenue. The consensus estimates had called for $1.89 in EPS and $9.7 billion in revenue, and the fourth quarter of last year reportedly had $1.85 in EPS and $10.84 billion in revenue.

During this past quarter, sales were down 10% on a reported basis and up 6% on an organic basis. The difference between reported and organic sales primarily relates to the spin-offs of the former Transportation Systems business (formerly in Aerospace) and the former Homes and ADI Global Distribution business (formerly in Honeywell Building Technologies), partially offset by the favorable impact of foreign currency translation.

In terms of its segments, Honeywell reported as follows:

  • Aerospace net sales decreased 12% year over year to $3.43 billion, an increase of 10% organically.
  • Honeywell Building Technologies net sales decreased 31% to $1.80 billion, an increase of 1% organically.
  • Performance Materials and Technologies net sales decreased 2% at $2.80 billion, flat organically.
  • Safety and Productivity Solutions net sales increased 15% to $1.70 billion, an increase of 15% organically.

Looking ahead to the 2019 full year, Honeywell expects to see EPS in the range of $7.80 to $8.10 and sales of $36.0 billion to $36.9 billion. Consensus estimates are calling for $7.88 in EPS and $37.05 billion in revenue.

Darius Adamczyk, board chair and chief executive officer of Honeywell.

Honeywell delivered a strong fourth quarter to finish out what was an incredible year for our customers, our employees, and our shareowners. Organic sales were up 6 percent in the fourth quarter and full year, primarily driven by continued strength in our long-cycle businesses in commercial aerospace, U.S. defense, and warehouse automation. Our long-cycle orders and backlog were up over 15 percent for the year, which positions us well for 2019 and beyond. Our focus on generating profitable growth combined with productivity rigor drove 80 basis points of segment margin expansion this quarter, and 60 basis points for the full year, exceeding the long-term targets we set forth in 2017.

Shares of Honeywell were last seen up about 2% at $146.39, in a 52-week range of $123.48 to $162.52. The consensus price target is $163.45.

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