HONEYWELL INTERNATIONAL INC (HON) Stock Fundamental Analysis
USA - NASDAQ:HON - US4385161066 - Common Stock
208.98 USD
-0.02 (-0.01%)
208.98 USD
0 (0%)
Overall HON gets a fundamental rating of 6 out of 10. We evaluated HON against 7 industry peers in the Industrial Conglomerates industry. HON scores excellent on profitability, but there are some minor concerns on its financial health. HON has a correct valuation and a medium growth rate.
1. Profitability
1.1 Basic Checks
HON had positive earnings in the past year.
HON had a positive operating cash flow in the past year.
Each year in the past 5 years HON has been profitable.
Each year in the past 5 years HON had a positive operating cash flow.
1.2 Ratios
HON has a Return On Assets of 7.29%. This is amongst the best in the industry. HON outperforms 85.71% of its industry peers.
Looking at the Return On Equity, with a value of 35.52%, HON belongs to the top of the industry, outperforming 85.71% of the companies in the same industry.
HON has a Return On Invested Capital of 10.45%. This is amongst the best in the industry. HON outperforms 85.71% of its industry peers.
HON had an Average Return On Invested Capital over the past 3 years of 12.23%. This is above the industry average of 8.05%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.29% | ||
| ROE | 35.52% | ||
| ROIC | 10.45% |
ROA(3y)8.25%
ROA(5y)8.15%
ROE(3y)32.02%
ROE(5y)30.63%
ROIC(3y)12.23%
ROIC(5y)11.94%
1.3 Margins
The Profit Margin of HON (14.30%) is better than 85.71% of its industry peers.
In the last couple of years the Profit Margin of HON has declined.
Looking at the Operating Margin, with a value of 20.76%, HON belongs to the top of the industry, outperforming 100.00% of the companies in the same industry.
HON's Operating Margin has been stable in the last couple of years.
HON has a Gross Margin of 38.08%. This is amongst the best in the industry. HON outperforms 85.71% of its industry peers.
HON's Gross Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 20.76% | ||
| PM (TTM) | 14.3% | ||
| GM | 38.08% |
OM growth 3Y-1.26%
OM growth 5Y0.55%
PM growth 3Y-2.75%
PM growth 5Y-2.4%
GM growth 3Y6%
GM growth 5Y2.48%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so HON is still creating some value.
Compared to 1 year ago, HON has less shares outstanding
Compared to 5 years ago, HON has less shares outstanding
The debt/assets ratio for HON is higher compared to a year ago.
2.2 Solvency
HON has an Altman-Z score of 3.17. This indicates that HON is financially healthy and has little risk of bankruptcy at the moment.
With an excellent Altman-Z score value of 3.17, HON belongs to the best of the industry, outperforming 85.71% of the companies in the same industry.
HON has a debt to FCF ratio of 7.35. This is a slightly negative value and a sign of low solvency as HON would need 7.35 years to pay back of all of its debts.
With an excellent Debt to FCF ratio value of 7.35, HON belongs to the best of the industry, outperforming 100.00% of the companies in the same industry.
A Debt/Equity ratio of 2.26 is on the high side and indicates that HON has dependencies on debt financing.
HON's Debt to Equity ratio of 2.26 is fine compared to the rest of the industry. HON outperforms 71.43% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.26 | ||
| Debt/FCF | 7.35 | ||
| Altman-Z | 3.17 |
ROIC/WACC1.34
WACC7.82%
2.3 Liquidity
HON has a Current Ratio of 1.29. This is a normal value and indicates that HON is financially healthy and should not expect problems in meeting its short term obligations.
HON has a Current ratio (1.29) which is comparable to the rest of the industry.
A Quick Ratio of 0.97 indicates that HON may have some problems paying its short term obligations.
Looking at the Quick ratio, with a value of 0.97, HON is in line with its industry, outperforming 57.14% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.29 | ||
| Quick Ratio | 0.97 |
3. Growth
3.1 Past
HON shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 7.28%.
Measured over the past 5 years, HON shows a small growth in Earnings Per Share. The EPS has been growing by 3.71% on average per year.
Looking at the last year, HON shows a small growth in Revenue. The Revenue has grown by 7.11% in the last year.
HON shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 0.96% yearly.
EPS 1Y (TTM)7.28%
EPS 3Y6.74%
EPS 5Y3.71%
EPS Q2Q%10.44%
Revenue 1Y (TTM)7.11%
Revenue growth 3Y3.83%
Revenue growth 5Y0.96%
Sales Q2Q%8.09%
3.2 Future
Based on estimates for the next years, HON will show a quite strong growth in Earnings Per Share. The EPS will grow by 9.36% on average per year.
HON is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 4.94% yearly.
EPS Next Y9.11%
EPS Next 2Y8.15%
EPS Next 3Y8.53%
EPS Next 5Y9.36%
Revenue Next Year7.02%
Revenue Next 2Y5.58%
Revenue Next 3Y5.5%
Revenue Next 5Y4.94%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
HON is valuated rather expensively with a Price/Earnings ratio of 20.27.
85.71% of the companies in the same industry are more expensive than HON, based on the Price/Earnings ratio.
Compared to an average S&P500 Price/Earnings ratio of 27.90, HON is valued a bit cheaper.
Based on the Price/Forward Earnings ratio of 18.25, the valuation of HON can be described as rather expensive.
Compared to the rest of the industry, the Price/Forward Earnings ratio of HON is on the same level as its industry peers.
HON's Price/Forward Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 23.36.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 20.27 | ||
| Fwd PE | 18.25 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of HON is on the same level as its industry peers.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of HON indicates a rather cheap valuation: HON is cheaper than 85.71% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 26.71 | ||
| EV/EBITDA | 15.48 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
The excellent profitability rating of HON may justify a higher PE ratio.
PEG (NY)2.23
PEG (5Y)5.46
EPS Next 2Y8.15%
EPS Next 3Y8.53%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 2.26%, HON has a reasonable but not impressive dividend return.
Compared to an average industry Dividend Yield of 6.03, HON pays a better dividend. On top of this HON pays more dividend than 85.71% of the companies listed in the same industry.
HON's Dividend Yield is comparable with the S&P500 average which is at 2.44.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.26% |
5.2 History
The dividend of HON has a limited annual growth rate of 5.64%.
HON has been paying a dividend for at least 10 years, so it has a reliable track record.
HON has decreased its dividend in the last 3 years.
Dividend Growth(5Y)5.64%
Div Incr Years2
Div Non Decr Years2
5.3 Sustainability
51.34% of the earnings are spent on dividend by HON. This is a bit on the high side, but may be sustainable.
The dividend of HON is growing, but earnings are growing more, so the dividend growth is sustainable.
DP51.34%
EPS Next 2Y8.15%
EPS Next 3Y8.53%
208.98
-0.02 (-0.01%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryIndustrial Conglomerates
Earnings (Last)
Earnings (Next)
Inst Owners80.87%
Inst Owner Change0%
Ins Owners0.04%
Ins Owner Change0%
Market Cap132.68B
Analysts75
Price Target259.28 (24.07%)
Short Float %1.43%
Short Ratio2.24
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.26% |
Yearly Dividend4.46
Dividend Growth(5Y)5.64%
DP51.34%
Div Incr Years2
Div Non Decr Years2
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)7.39%
Min EPS beat(2)2.48%
Max EPS beat(2)12.31%
EPS beat(4)4
Avg EPS beat(4)5.56%
Min EPS beat(4)2.07%
Max EPS beat(4)12.31%
EPS beat(8)7
Avg EPS beat(8)3.37%
EPS beat(12)10
Avg EPS beat(12)3.01%
EPS beat(16)13
Avg EPS beat(16)2.52%
Revenue beat(2)2
Avg Revenue beat(2)1.58%
Min Revenue beat(2)1.37%
Max Revenue beat(2)1.79%
Revenue beat(4)3
Avg Revenue beat(4)0.51%
Min Revenue beat(4)-2.72%
Max Revenue beat(4)1.79%
Revenue beat(8)4
Avg Revenue beat(8)-0.27%
Revenue beat(12)5
Avg Revenue beat(12)-0.29%
Revenue beat(16)7
Avg Revenue beat(16)-0.38%
PT rev (1m)0.47%
PT rev (3m)4.95%
EPS NQ rev (1m)-0.05%
EPS NQ rev (3m)1%
EPS NY rev (1m)0.03%
EPS NY rev (3m)1.85%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)1.35%
Revenue NY rev (1m)0.07%
Revenue NY rev (3m)1.94%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 20.27 | ||
| Fwd PE | 18.25 | ||
| P/S | 3.32 | ||
| P/FCF | 26.71 | ||
| P/OCF | 21.42 | ||
| P/B | 8.24 | ||
| P/tB | N/A | ||
| EV/EBITDA | 15.48 |
EPS(TTM)10.31
EY4.93%
EPS(NY)11.45
Fwd EY5.48%
FCF(TTM)7.82
FCFY3.74%
OCF(TTM)9.76
OCFY4.67%
SpS62.99
BVpS25.35
TBVpS-23.73
PEG (NY)2.23
PEG (5Y)5.46
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.29% | ||
| ROE | 35.52% | ||
| ROCE | 14.62% | ||
| ROIC | 10.45% | ||
| ROICexc | 12.58% | ||
| ROICexgc | 31.05% | ||
| OM | 20.76% | ||
| PM (TTM) | 14.3% | ||
| GM | 38.08% | ||
| FCFM | 12.42% |
ROA(3y)8.25%
ROA(5y)8.15%
ROE(3y)32.02%
ROE(5y)30.63%
ROIC(3y)12.23%
ROIC(5y)11.94%
ROICexc(3y)15.24%
ROICexc(5y)15.49%
ROICexgc(3y)37.17%
ROICexgc(5y)37.38%
ROCE(3y)16.37%
ROCE(5y)16.08%
ROICexcg growth 3Y-3.6%
ROICexcg growth 5Y-3.76%
ROICexc growth 3Y-5.53%
ROICexc growth 5Y-5.14%
OM growth 3Y-1.26%
OM growth 5Y0.55%
PM growth 3Y-2.75%
PM growth 5Y-2.4%
GM growth 3Y6%
GM growth 5Y2.48%
F-Score6
Asset Turnover0.51
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.26 | ||
| Debt/FCF | 7.35 | ||
| Debt/EBITDA | 3.71 | ||
| Cap/Depr | 81.08% | ||
| Cap/Sales | 3.07% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 63.11% | ||
| Profit Quality | 86.9% | ||
| Current Ratio | 1.29 | ||
| Quick Ratio | 0.97 | ||
| Altman-Z | 3.17 |
F-Score6
WACC7.82%
ROIC/WACC1.34
Cap/Depr(3y)79.74%
Cap/Depr(5y)80.57%
Cap/Sales(3y)2.67%
Cap/Sales(5y)2.68%
Profit Quality(3y)84.42%
Profit Quality(5y)91.4%
High Growth Momentum
Growth
EPS 1Y (TTM)7.28%
EPS 3Y6.74%
EPS 5Y3.71%
EPS Q2Q%10.44%
EPS Next Y9.11%
EPS Next 2Y8.15%
EPS Next 3Y8.53%
EPS Next 5Y9.36%
Revenue 1Y (TTM)7.11%
Revenue growth 3Y3.83%
Revenue growth 5Y0.96%
Sales Q2Q%8.09%
Revenue Next Year7.02%
Revenue Next 2Y5.58%
Revenue Next 3Y5.5%
Revenue Next 5Y4.94%
EBIT growth 1Y6.67%
EBIT growth 3Y2.52%
EBIT growth 5Y1.51%
EBIT Next Year22.59%
EBIT Next 3Y11.87%
EBIT Next 5Y10.87%
FCF growth 1Y19.02%
FCF growth 3Y-1.38%
FCF growth 5Y-4.03%
OCF growth 1Y23.26%
OCF growth 3Y0.32%
OCF growth 5Y-2.44%