Honeywell (HON) was another of the many names that reported earnings Thursday.
The conglomerate said first-quarter earnings were $1.02 billion, or $1.28 a share, up from $1.21 a share in the year-ago period and two cents better than the $1.26 analysts had forecast.
Revenue climbed 3.8% to $9.68 billion, just below the $9.74 billion consensus.
As for individual divisions, its transportation systems unit saw the biggest sales jump, at 8.6%, followed by automation and control systems, the biggest contributor to the top line, which saw revenue climb 7.6%. The performance materials and technologies arm logged a 2.2% rise in sales, while the aerospace unit slipped $1.8%.
Honeywell also increased the lower end of its full-year earnings outlook by a nickel, saying it now expects to earn between $5.40 and $5.55 a share.
Citigroup's Deane Dray maintained a Neutral rating on the stock: "The company reported disappointing 1% organic revenue growth vs. 2%-4% expectations that were reiterated in March due to Aerospace and PMT. On the operating line, the company beat our estimates by $0.04 including better than expected operating margin in all four business segments. Despite some headwinds in PMT, the company was able to post consolidated 16.5% margins, up 30 bps Y/Y. Above-plan profitability allowed Honeywell to spend an extra penny on restructuring and proactive environmental remediation, above its $0.10 gain on its sale of BEAV shares. Cash was strong in the seasonally weak quarter with 49% conversion, allowing the company to increase its full year cash guidance. EPS guidance was increased by 5c at the low-end to $5.40-$5.55 with 3%-4% organic rev growth reaffirmed. Guidance for 2Q14 is $1.32-$1.36 vs our $1.37 estimate and consensus."
Top Warren Buffett Companies To Invest In Right Now
Morningstar's Daniel Holland was more optimistic, however, and reiterated a Buy rating and $105 fair value on the stock: "Honeywell's first-quarter performance reflected the benefits of having a diversified business model as weakness in the company's aerospace business, which was down 2% versus the prior year, was offset by strength in automation and controls as well as the aforementioned strength in turbochargers. Importantly, the company delivered margin expansion in three of the four operating segments, including a 30 basis point improvement in aerospace. As the company rolls out more of its operating initiatives linked to Honeywell Operating Systems, we expect meaningful margin expansion of two percentage points over the next five years, consistent with the low end of company's recently released five-year plan."
No comments:
Post a Comment