Honeywell International Inc: Good start to NewCo

Research evidence excerpt

Honeywell International Inc: Good start to NewCo

Forecast returns

Forecast price appreciation 15.9%

Forecast dividend yield 2.2%

Forecast stock return 18.0%

Market return assumption 9.3%

Forecast excess return 8.8%

Company Description

Honeywell is a global diversified industrial company reporting across four segments:

Aerospace; Honeywell Building Technologies; Performance Materials and Technologies; and

Safety and Productivity Solutions.

Valuation Method and Risk Statement

Our price target is based on NTM P/E.

Risk Statement: The Electrical Equipment and Multi Industry sector faces a broad range of

risks. It is cyclical in nature with exposure to the underlying cycles inherent in everything from

aviation, auto, trucking and trains to construction and consumer electronics to mining,

power, oil and gas and more depending on the specific stock. EEMI companies are subject to

risks associated with unexpected changes in the underlying global macro environment,

currency and interest rate movements, commodity price inflation as well as company-specific

execution, M&A, integration, labor relations and changes in the competitive or regulatory

environment. These changes can be in the form of product technology, e-commerce and

other digital disruption and/or channel disintermediation. Changes in the overall macro

environment can result from health emergencies such as COVID-19 and other pandemics.

Capacity and related pricing pressures are also a risk through the cycle. Finally, these

multinational companies are subject to policy changes taking place in the United States and

internationally, including those related to environmental regulation and tariffs.

Specific to the company, risks to the upside include short cycle acceleration and bolder