HONEYWELL INTERNATIONAL INC (HON) Stock Fundamental Analysis
NASDAQ:HON - Nasdaq - US4385161066 - Common Stock
Overall HON gets a fundamental rating of 6 out of 10. We evaluated HON against 8 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
In the past year HON was profitable.
HON had a positive operating cash flow in the past year.
Of the past 5 years HON 4 years were profitable.
Of the past 5 years HON 4 years had a positive operating cash flow.
1.2 Ratios
With an excellent Return On Assets value of 7.73%, HON belongs to the best of the industry, outperforming 87.50% of the companies in the same industry.
The Return On Equity of HON (32.65%) is better than 87.50% of its industry peers.
HON's Return On Invested Capital of 10.78% is fine compared to the rest of the industry. HON outperforms 75.00% of its industry peers.
The Average Return On Invested Capital over the past 3 years for HON is above the industry average of 9.51%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.73% | ||
| ROE | 32.65% | ||
| ROIC | 10.78% |
ROA(3y)8.59%
ROA(5y)8.73%
ROE(3y)31.76%
ROE(5y)31.14%
ROIC(3y)12.51%
ROIC(5y)12.3%
1.3 Margins
The Profit Margin of HON (15.01%) is better than 87.50% of its industry peers.
In the last couple of years the Profit Margin of HON has remained more or less at the same level.
The Operating Margin of HON (20.71%) is better than 100.00% of its industry peers.
In the last couple of years the Operating Margin of HON has grown nicely.
Looking at the Gross Margin, with a value of 37.60%, HON is in the better half of the industry, outperforming 75.00% of the companies in the same industry.
In the last couple of years the Gross Margin of HON has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 20.71% | ||
| PM (TTM) | 15.01% | ||
| GM | 37.6% |
OM growth 3Y0.24%
OM growth 5Y2.83%
PM growth 3Y1.77%
PM growth 5Y-0.95%
GM growth 3Y5.14%
GM growth 5Y4.08%
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.
There is no outstanding debt for HON. This means it has a Debt/Equity and Debt/FCF ratio of 0 and it is amongst the best of the sector and industry.
2.2 Solvency
An Altman-Z score of 3.51 indicates that HON is not in any danger for bankruptcy at the moment.
HON has a Altman-Z score of 3.51. This is amongst the best in the industry. HON outperforms 87.50% of its industry peers.
The Debt to FCF ratio of HON is 5.47, which is a neutral value as it means it would take HON, 5.47 years of fcf income to pay off all of its debts.
HON has a better Debt to FCF ratio (5.47) than 87.50% of its industry peers.
HON has a Debt/Equity ratio of 1.67. This is a high value indicating a heavy dependency on external financing.
Looking at the Debt to Equity ratio, with a value of 1.67, HON is in the better half of the industry, outperforming 75.00% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.67 | ||
| Debt/FCF | 5.47 | ||
| Altman-Z | 3.51 |
ROIC/WACC1.28
WACC8.44%
2.3 Liquidity
HON has a Current Ratio of 1.44. 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 better Current ratio (1.44) than 87.50% of its industry peers.
A Quick Ratio of 1.12 indicates that HON should not have too much problems paying its short term obligations.
Looking at the Quick ratio, with a value of 1.12, HON is in the better half of the industry, outperforming 75.00% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.44 | ||
| Quick Ratio | 1.12 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 9.13% over the past year.
The Earnings Per Share has been growing slightly by 2.92% on average over the past years.
HON shows a small growth in Revenue. In the last year, the Revenue has grown by 3.96%.
The Revenue has been decreasing by -2.59% on average over the past years.
EPS 1Y (TTM)9.13%
EPS 3Y8.9%
EPS 5Y2.92%
EPS Q2Q%13.66%
Revenue 1Y (TTM)3.96%
Revenue growth 3Y3.95%
Revenue growth 5Y-2.59%
Sales Q2Q%5.6%
3.2 Future
The Earnings Per Share is expected to grow by 10.15% on average over the next years. This is quite good.
The Revenue is expected to grow by 5.32% on average over the next years.
EPS Next Y7.47%
EPS Next 2Y10.17%
EPS Next 3Y9.96%
EPS Next 5Y10.15%
Revenue Next Year3.86%
Revenue Next 2Y6.02%
Revenue Next 3Y5.77%
Revenue Next 5Y5.32%
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.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
HON is valuated rather expensively with a Price/Earnings ratio of 22.44.
HON's Price/Earnings ratio is a bit cheaper when compared to the industry. HON is cheaper than 62.50% of the companies in the same industry.
When comparing the Price/Earnings ratio of HON to the average of the S&P500 Index (27.96), we can say HON is valued inline with the index average.
The Price/Forward Earnings ratio is 20.00, which indicates a rather expensive current valuation of HON.
Based on the Price/Forward Earnings ratio, HON is valued a bit cheaper than the industry average as 75.00% of the companies are valued more expensively.
When comparing the Price/Forward Earnings ratio of HON to the average of the S&P500 Index (24.11), we can say HON is valued inline with the index average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 22.44 | ||
| Fwd PE | 20 |
4.2 Price Multiples
HON's Enterprise Value to EBITDA is on the same level as the industry average.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of HON indicates a somewhat cheap valuation: HON is cheaper than 62.50% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 25.68 | ||
| EV/EBITDA | 17.73 |
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)3
PEG (5Y)7.68
EPS Next 2Y10.17%
EPS Next 3Y9.96%
5. Dividend
5.1 Amount
HON has a Yearly Dividend Yield of 2.03%. Purely for dividend investing, there may be better candidates out there.
Compared to an average industry Dividend Yield of 5.52, HON pays a better dividend. On top of this HON pays more dividend than 87.50% of the companies listed in the same industry.
HON's Dividend Yield is comparable with the S&P500 average which is at 2.29.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.03% |
5.2 History
The dividend of HON is nicely growing with an annual growth rate of 7.24%!
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)7.24%
Div Incr Years2
Div Non Decr Years2
5.3 Sustainability
50.54% of the earnings are spent on dividend by HON. This is a bit on the high side, but may be sustainable.
HON's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP50.54%
EPS Next 2Y10.17%
EPS Next 3Y9.96%
HONEYWELL INTERNATIONAL INC
NASDAQ:HON (1/17/2025, 8:06:25 PM)
After market: 222.59 0.01 (0%)222.58
-0.11 (-0.05%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryIndustrial Conglomerates
Earnings (Last)
Earnings (Next)
Inst Owners80.37%
Inst Owner Change-0.08%
Ins Owners0.04%
Ins Owner Change0%
Market Cap144.73B
Analysts72.9
Price Target252.06 (13.24%)
Short Float %1.49%
Short Ratio2.27
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.03% |
Yearly Dividend4.33
Dividend Growth(5Y)7.24%
DP50.54%
Div Incr Years2
Div Non Decr Years2
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)2.07%
Min EPS beat(2)2.07%
Max EPS beat(2)2.08%
EPS beat(4)3
Avg EPS beat(4)1.49%
Min EPS beat(4)-0.75%
Max EPS beat(4)2.56%
EPS beat(8)6
Avg EPS beat(8)1.58%
EPS beat(12)9
Avg EPS beat(12)1.65%
EPS beat(16)13
Avg EPS beat(16)1.98%
Revenue beat(2)1
Avg Revenue beat(2)-0.98%
Min Revenue beat(2)-2.72%
Max Revenue beat(2)0.76%
Revenue beat(4)1
Avg Revenue beat(4)-1.44%
Min Revenue beat(4)-3.61%
Max Revenue beat(4)0.76%
Revenue beat(8)2
Avg Revenue beat(8)-0.86%
Revenue beat(12)4
Avg Revenue beat(12)-0.65%
Revenue beat(16)7
Avg Revenue beat(16)-0.09%
PT rev (1m)4.32%
PT rev (3m)9.21%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-5.79%
EPS NY rev (1m)0%
EPS NY rev (3m)-3.93%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-1.24%
Revenue NY rev (1m)-0.01%
Revenue NY rev (3m)-2.18%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 22.44 | ||
| Fwd PE | 20 | ||
| P/S | 3.82 | ||
| P/FCF | 25.68 | ||
| P/OCF | 21.38 | ||
| P/B | 8.32 | ||
| P/tB | N/A | ||
| EV/EBITDA | 17.73 |
EPS(TTM)9.92
EY4.46%
EPS(NY)11.13
Fwd EY5%
FCF(TTM)8.67
FCFY3.89%
OCF(TTM)10.41
OCFY4.68%
SpS58.21
BVpS26.77
TBVpS-14.78
PEG (NY)3
PEG (5Y)7.68
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.73% | ||
| ROE | 32.65% | ||
| ROCE | 14.52% | ||
| ROIC | 10.78% | ||
| ROICexc | 13.33% | ||
| ROICexgc | 32.14% | ||
| OM | 20.71% | ||
| PM (TTM) | 15.01% | ||
| GM | 37.6% | ||
| FCFM | 14.89% |
ROA(3y)8.59%
ROA(5y)8.73%
ROE(3y)31.76%
ROE(5y)31.14%
ROIC(3y)12.51%
ROIC(5y)12.3%
ROICexc(3y)15.91%
ROICexc(5y)16.13%
ROICexgc(3y)38.08%
ROICexgc(5y)38.4%
ROCE(3y)16.93%
ROCE(5y)16.78%
ROICexcg growth 3Y0.66%
ROICexcg growth 5Y-5.32%
ROICexc growth 3Y1.1%
ROICexc growth 5Y-2.97%
OM growth 3Y0.24%
OM growth 5Y2.83%
PM growth 3Y1.77%
PM growth 5Y-0.95%
GM growth 3Y5.14%
GM growth 5Y4.08%
F-Score6
Asset Turnover0.52
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.67 | ||
| Debt/FCF | 5.47 | ||
| Debt/EBITDA | 3.2 | ||
| Cap/Depr | 90.22% | ||
| Cap/Sales | 3% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 74.45% | ||
| Profit Quality | 99.17% | ||
| Current Ratio | 1.44 | ||
| Quick Ratio | 1.12 | ||
| Altman-Z | 3.51 |
F-Score6
WACC8.44%
ROIC/WACC1.28
Cap/Depr(3y)75.05%
Cap/Depr(5y)78.54%
Cap/Sales(3y)2.53%
Cap/Sales(5y)2.53%
Profit Quality(3y)86.53%
Profit Quality(5y)93.83%
High Growth Momentum
Growth
EPS 1Y (TTM)9.13%
EPS 3Y8.9%
EPS 5Y2.92%
EPS Q2Q%13.66%
EPS Next Y7.47%
EPS Next 2Y10.17%
EPS Next 3Y9.96%
EPS Next 5Y10.15%
Revenue 1Y (TTM)3.96%
Revenue growth 3Y3.95%
Revenue growth 5Y-2.59%
Sales Q2Q%5.6%
Revenue Next Year3.86%
Revenue Next 2Y6.02%
Revenue Next 3Y5.77%
Revenue Next 5Y5.32%
EBIT growth 1Y8.95%
EBIT growth 3Y4.2%
EBIT growth 5Y0.17%
EBIT Next Year20.43%
EBIT Next 3Y12.56%
EBIT Next 5Y9.92%
FCF growth 1Y18.28%
FCF growth 3Y-6.74%
FCF growth 5Y-5.16%
OCF growth 1Y21.54%
OCF growth 3Y-4.9%
OCF growth 5Y-3.66%