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How Do Analysts See Honeywell International Inc. (NYSE:HON) Performing In The Next Couple Of Years?

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Honeywell International Inc.’s (NYSE:HON) latest earnings announcement in December 2018 confirmed that the company benefited from a substantial tailwind, more than doubling its earnings from the prior year. Below, I’ve laid out key growth figures on how market analysts predict Honeywell International’s earnings growth outlook over the next couple of years and whether the future looks even brighter than the past. I will be looking at earnings excluding extraordinary items to exclude one-off activities to get a better understanding of the underlying drivers of earnings.

View our latest analysis for Honeywell International

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Market analysts’ consensus outlook for the upcoming year seems pessimistic, with earnings falling by a double-digit -14%. In the next couple of years, earnings will begin to improve, increasing year on year, and generating US$6.6b by 2022.

NYSE:HON Future Profit February 4th 19
NYSE:HON Future Profit February 4th 19

Even though it’s useful to understand the growth each year relative to today’s value, it may be more valuable to determine the rate at which the business is growing every year, on average. The benefit of this method is that we can get a bigger picture of the direction of Honeywell International’s earnings trajectory over the long run, irrespective of near term fluctuations, which may be more relevant for long term investors. To calculate this rate, I put a line of best fit through the forecasted earnings by market analysts. The slope of this line is the rate of earnings growth, which in this case is 0.3%. This means, we can expect Honeywell International will grow its earnings by 0.3% every year for the next few years.

Next Steps:

For Honeywell International, I’ve put together three key aspects you should further research:

  1. Financial Health: Does it have a healthy balance sheet? Take a look at our free balance sheet analysis with six simple checks on key factors like leverage and risk.

  2. Valuation: What is HON worth today? Is the stock undervalued, even when its growth outlook is factored into its intrinsic value? The intrinsic value infographic in our free research report helps visualize whether HON is currently mispriced by the market.

  3. Other High-Growth Alternatives: Are there other high-growth stocks you could be holding instead of HON? Explore our interactive list of stocks with large growth potential to get an idea of what else is out there you may be missing!

To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.

The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.