Thursday, August 16, 2012

Honeywell 2Q2012

     On July 18, 2012 Honeywell reported earnings of $1.14 a share, beating the street estimate of $1.12 set out by the 20 analysts covering the company. The company’s second quarter profit rose 11% as the company’s revenues were $9.44 billion, an increase of 4%, just under the projection of $9.56 billion. The company then proceeded to adjust expected revenues FY2012 by decreasing the range of 37.8 billion-38.4 billion from $38 billion- 38.6 billion. Despite this decrease in projected earnings, we see the company raising its FY2012 outlook to $4.40-$4.55. This represents a trend that we have been seeing across the street this earnings season. Many companies have been able to beat projected EPS, while underperforming in regards to revenue. This trend suggests a move towards greater efficiency and could mean the loss of jobs across America. CEO Dave Cote had this to say of the changes in projections, “Given the increasingly uncertain global economic environment, we’ll remain flexible, but also continue to invest in sustainable growth through seed planting in new products and technologies, geographic expansion and our key initiatives.”

     A global leader in the making of aerospace, building-control and safety products, Honeywell has received a total of 4 Strong Buys, 10 Buys, and 6 Holds according to CNBC. They have benefited from a steady increase in demand across all major segments. Their extensive work with Boeing generated an increase in their aerospace unit of 8%. We saw Honeywell sign a deal with satellite-operator Immarsat to manufacture equipment for airborne broadband connections, which will last 20 years, and could create up to $2.8 billion in revenues. 

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