Last week, you might have seen that Honeywell International Inc. (NYSE:HON) released its full-year result to the market. The early response was not positive, with shares down 3.1% to US$196 in the past week. It was a credible result overall, with revenues of US$33b and statutory earnings per share of US$6.72 both in line with analyst estimates, showing that Honeywell International is executing in line with expectations. This is an important time for investors, as they can track a company’s performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. With this in mind, we’ve gathered the latest statutory forecasts to see what the analysts are expecting for next year.
See our latest analysis for Honeywell International
Following the latest results, Honeywell International’s 19 analysts are now forecasting revenues of US$34.1b in 2021. This would be a modest 4.4% improvement in sales compared to the last 12 months. Statutory earnings per share are predicted to grow 15% to US$7.82. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$33.9b and earnings per share (EPS) of US$7.80 in 2021. So it’s pretty clear that, although the analysts have updated their estimates, there’s been no major change in expectations for the business following the latest results.
The analysts reconfirmed their price target of US$209, showing that the business is executing well and in line with expectations. The consensus price target is just an average of individual analyst targets, so – it could be handy to see how wide the range of underlying estimates is. The most optimistic Honeywell International analyst has a price target of US$260 per share, while the most pessimistic values it at US$140. Analysts definitely have varying views on the business, but the spread of estimates is not wide enough in our view to suggest that extreme outcomes could await Honeywell International shareholders.
Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. One thing stands out from these estimates, which is that Honeywell International is forecast to grow faster in the future than it has in the past, with revenues expected to grow 4.4%. If achieved, this would be a much better result than the 2.6% annual decline over the past five years. Compare this against analyst estimates for the wider industry, which suggest that (in aggregate) industry revenues are expected to grow 6.9% next year. Although Honeywell International’s revenues are expected to improve, it seems that the analysts are still bearish on the business, forecasting it to grow slower than the wider industry.
The Bottom Line
The most obvious conclusion is that there’s been no major change in the business’ prospects in recent times, with the analysts holding their earnings forecasts steady, in line with previous estimates. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting sales are tracking in line with expectations – although our data does suggest that Honeywell International’s revenues are expected to perform worse than the wider industry. The consensus price target held steady at US$209, with the latest estimates not enough to have an impact on their price targets.
With that said, the long-term trajectory of the company’s earnings is a lot more important than next year. We have forecasts for Honeywell International going out to 2023, and you can see them free on our platform here.
And what about risks? Every company has them, and we’ve spotted 2 warning signs for Honeywell International you should know about.
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