Upcoming AWS Coverage on Danaher Post-Earnings Results

LONDON, UK / ACCESSWIRE / February 9, 2017 / Active Wall St. announces its post-earnings coverage on Honeywell International Inc. (NYSE: HON). The Company released its fourth quarter and fiscal year 2016 results on January 27, 2017. The diversified US manufacturer met earnings expectations. Register with us now for your free membership at:

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One of Honeywell International's competitors within the Diversified Machinery space, Danaher Corp. (NYSE: DHR), announced on January 31, 2017, its results for Q4 and full year 2016. AWS will be initiating a research report on Danaher in the coming days.

Today, AWS is promoting its earnings coverage on HON; touching on DHR. Get our free coverage by signing up to:

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Earnings Reviewed

For the reported quarter, Honeywell's revenues were $9.99 billion compared to revenue of $9.98 billion in Q4 2015. However, revenues missed analysts' consensus forecasts of $1.02 billion. For FY16, Honeywell reported revenues of $39.30 billion compared to FY15 revenue of $38.58 billion.

The Company reported Q4 2016 operating income of $2.01 billion, up compared to operating income of $1.80 billion in Q4 2015. Honeywell's operating margin during the reported quarter was 16.2%, down 120 basis points compared to the year earlier same quarter.

For the quarter ended December 31, 2016, Honeywell reported net income of $1.03 billion, or $1.34 per share, down from $1.19 billion, or $1.53 per share, in Q4 2015. Excluding restructuring and other charges, the Company posted earnings of $1.74 per share, up 14% on a y-o-y basis, which met Wall Street's forecasts for earnings of $1.74 per share. For FY16, the Company reported adjusted earnings of $6.60 per share compared to FY15 earnings of $6.10.

Segment Performance

Honeywell's segment profit was $1.90 billion for Q4 2016 compared to $1.88 billion in Q4 2015. The Company's overall segment profit margin was 19.0% in the reported quarter, up 20 basis points from 18.8% in the year earlier quarter. Honeywell stated that the segment's profit margin was up 90 basis points at 19.7% excluding the first year dilutive impacts from M&A.

For Q4 2016, Honeywell's Aerospace segment's sales were $3.67 billion, down compared to sales of $3.98 billion in Q4 2015. The decrease was primarily driven by lower volumes in Business and General Aviation, higher OEM incentives, program completions in the US Space and International Defense, and continued weakness in the commercial helicopter business. Aerospace's segment's margin declined 130 basis points to 20.2%, due to higher OEM incentives, product mix, and lower volumes, and was partially offset by productivity net of inflation and commercial excellence.

The Company's Home and Building Technologies' sales grew 13% to $2.80 billion in Q4 2016, driven by continued strength in its Building Solutions and Distribution businesses, double-digit growth in China and India, and new product introductions in Environmental and Energy Solution. The segment's margin declined 30 basis points to 16.8%, primarily driven by acquisition amortization and integration costs.

During Q4 2016, Honeywell's Performance Materials and Technologies' segment generated revenues of $2.23 billion, up 5% on a core organic basis driven by strong catalyst, licensing, and equipment growth in UOP and a continued ramp in Solstice® sales in Advanced Materials. The segment's margin expanded 520 bps to 25.4%, driven by productivity net of inflation, the favorable impact from the spin-off of AdvanSix, higher catalyst volumes, and commercial excellence.

The Company's Safety and Productivity Solutions' revenue totaled $1.29 billion in Q4 2016, up 9% on y-o-y. The segment's margin contracted 100 bps to 14.3%, primarily driven by acquisition amortization and integration costs.

Balance Sheet and Cash Flow

As of December 31, 2016, Honeywell's cash and cash equivalents totaled $7.84 billion compared to $5.46 billion as on December 31, 2015. The Company's long-term debt totaled $12.18 billion compared to $5.56 billion on December 31, 2015.

For Q4 2016, Honeywell's cash from operating activities was $2.04 billion compared to $1.96 billion in Q4 2015. The Company's free cash flow was $1.70 billion during the reported quarter.

Outlook

Honeywell reaffirmed its FY17 guidance of 6% to 10% earnings growth ex-divestitures, and organic sales growth of 1% to 3%. For Q1 2017, the Company is forecasting EPS guidance of $1.60 to $1.64, which is a 6% to 9% increase y-o-y, ex-divestitures.

Stock Performance

On January 08, 2017, Honeywell International's share price finished the trading session at $119.73, marginally up by 0.01%. A total volume of 1.82 million shares exchanged hands. The stock has advanced 8.26% and 19.14% in the last three months and past twelve months, respectively. Furthermore, since the start of the year, shares of the Company have gained 3.35%. The stock is trading at a PE ratio of 19.28 and has a dividend yield of 2.22%.

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SOURCE: Active Wall Street