What To Expect From Honeywell’s Q1 Earnings

by Trefis Team
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Honeywell International (NYSE: HON), posted a rather decent quarter last time around. The company managed to beat the earnings and revenue consensus estimates while increasing its outlook for 2018 notably. The raise in the guidance was primarily attributable to the massive benefits the conglomerate intends to realize from the tax cut that was announced recently. As a result, it also hopes to repatriate close to $7 billion of the $10 billion that is held overseas over the next two years. For this reason, the company now expects to earn between $7.75 and $8 per share for the full year, in comparison to the previous guidance of $7.55 to $7.80. Additionally, revenues are expected to come in the range of $41.8 billion to $42.5 billion.

At the moment, we believe Honeywell’s current price to be at par with our price estimate. We have created an interactive dashboard analysis to estimate the company’s valuation based on its expected revenue for FY 2018. Click on the link to modify the figures to arrive at your own price estimate.

In Q1, Honeywell is expected to see its revenues climb by about 4.7% to reach $9.94 billion. Meanwhile, the company’s earnings are projected to climb by 13.9% to $1.89 per share.

Revenues in the quarter are expected to be driven by good growth fundamentals across all segments.

  • Intelligrated is again expected to drive growth at Safety and Productivity Solutions (SPS). Coupled with higher demand for industrial safety products, Movilizer software sales, and better performance at voice-enabled workflow solutions, we expect the top line to benefit greatly in the quarter.
  • Aerospace, and Performance Materials and Technologies (PMT) revenues, have historically weighed on the overall top line. However, towards the end of last year, we saw hints of a reversal in this trend at both segments. Q1 results could shed some more light on this.
  • Home and Building Technologies are expected to see its revenues climb in the quarter on the back of an improving global economy, which has consequently led to higher construction activity.
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