Honeywell International Inc. is not just a player in the conglomerate sector; it is a transformative force that enhances how industries operate and impacts our daily lives. With cutting-edge innovations in aerospace, building technologies, and safety solutions, Honeywell is synonymous with quality and efficiency. As the world increasingly focuses on sustainability and productivity, I find myself questioning whether Honeywell’s robust fundamentals and growth trajectory justify its current market valuation.
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Company Description
Honeywell International Inc. (ticker: HON), founded in 1906 and headquartered in Charlotte, North Carolina, operates as a diversified technology and manufacturing company. With a market capitalization of approximately $126.4B, Honeywell is a prominent player in the conglomerates industry. Its core activities span four main segments: Aerospace, Building Technologies, Performance Materials and Technologies, and Safety and Productivity Solutions. The company offers a wide range of products and services, from advanced avionics and environmental control systems to personal protection equipment and automation software. Operating primarily in the US and globally, Honeywell is strategically positioned as an innovator, shaping industry standards through sustainable practices and cutting-edge technologies.
Fundamental Analysis
In this section, I will conduct a fundamental analysis of Honeywell International Inc., focusing on its income statement, financial ratios, and dividend payout policy.
Income Statement
Here is Honeywell International Inc.’s income statement for the last five fiscal years, summarizing key financial metrics that are crucial for evaluating the company’s performance.
| Metric | 2020 | 2021 | 2022 | 2023 | 2024 |
|---|---|---|---|---|---|
| Revenue | 32.64B | 34.39B | 35.45B | 36.65B | 38.50B |
| Cost of Revenue | 20.49B | 21.61B | 21.84B | 22.35B | 23.74B |
| Operating Expenses | 5.86B | 6.03B | 6.38B | 6.42B | 6.89B |
| Gross Profit | 12.15B | 12.78B | 13.61B | 14.29B | 14.76B |
| EBITDA | 7.37B | 8.80B | 7.99B | 9.10B | 9.61B |
| EBIT | 6.37B | 7.58B | 6.79B | 7.92B | 8.27B |
| Interest Expense | 0.36B | 0.34B | 0.41B | 0.77B | 1.06B |
| Net Income | 4.78B | 5.54B | 4.97B | 5.66B | 5.71B |
| EPS | 6.79 | 8.01 | 7.33 | 8.53 | 8.76 |
| Filing Date | 2021-02-12 | 2022-02-11 | 2023-02-10 | 2024-02-16 | 2025-02-14 |
Over the past five years, Honeywell has shown a steady increase in revenue, growing from 32.64B in 2020 to 38.50B in 2024, indicating a strong upward trend. Net income has also experienced growth, rising from 4.78B to 5.71B in the same period. Margins have remained relatively stable, with slight fluctuations in EBITDA and EBIT margins, reflecting effective cost management despite rising operating expenses. In the most recent year, while revenue growth continued, the pace showed signs of slowing, and the interest expense increased, which could indicate potential headwinds for profitability if not managed carefully.
Financial Ratios
The table below summarizes the key financial ratios for Honeywell International Inc. (HON) over the most recent years. This data provides insights into the company’s profitability, efficiency, liquidity, and leverage.
| Ratios | 2020 | 2021 | 2022 | 2023 | 2024 |
|---|---|---|---|---|---|
| Net Margin | 14.64% | 16.12% | 14.01% | 15.44% | 14.82% |
| ROE | 16.50% | 17.83% | 14.98% | 16.70% | 15.85% |
| ROIC | 8.85% | 9.34% | 7.67% | 8.23% | 8.21% |
| P/E | 31.34 | 26.05 | 29.22 | 24.57 | 25.77 |
| P/B | 8.53 | 7.77 | 8.69 | 8.77 | 7.90 |
| Current Ratio | 1.47 | 1.30 | 1.25 | 1.27 | 1.31 |
| Quick Ratio | 1.23 | 1.04 | 0.98 | 0.93 | 1.01 |
| D/E | 1.32 | 1.11 | 1.23 | 1.36 | 1.73 |
| Debt-to-Assets | 35.94% | 32.00% | 32.98% | 35.00% | 42.85% |
| Interest Coverage | 17.52 | 19.66 | 17.47 | 10.29 | 7.44 |
| Asset Turnover | 0.51 | 0.53 | 0.57 | 0.60 | 0.51 |
| Fixed Asset Turnover | 5.86 | 6.18 | 6.48 | 6.47 | 6.22 |
| Dividend Yield | 1.73% | 1.82% | 1.87% | 2.05% | 1.97% |
Interpretation of Financial Ratios
In 2024, Honeywell’s ratios reveal a mixed performance. The net margin of 14.82% indicates a solid profitability level, but the declining interest coverage ratio of 7.44 raises concerns about debt servicing capability. The increase in the debt-to-equity (D/E) ratio to 1.73 signals growing leverage, which could elevate financial risk.
Evolution of Financial Ratios
Over the past five years, Honeywell’s financial ratios have shown some volatility. Notably, the net margin has fluctuated, while the D/E ratio has increased significantly, reflecting a trend toward higher leverage. The current ratio remains stable, indicating consistent liquidity management despite rising debt levels.
Distribution Policy
Honeywell International Inc. (HON) maintains a robust dividend policy, with a current dividend payout ratio of 51% and a yield of approximately 1.97%. The company has shown a consistent upward trend in its dividend per share, currently at 4.46 USD. Additionally, Honeywell engages in share buybacks, which can enhance shareholder value but also poses risks if not managed prudently. Overall, this balanced approach supports sustainable long-term value creation for shareholders.
Sector Analysis
Honeywell International Inc. is a diversified technology and manufacturing leader in the industrial sector, competing with firms like GE and Siemens, while leveraging advanced technologies across its various segments.
Strategic Positioning
Honeywell International Inc. (HON) holds a significant position in the conglomerate sector, with a market cap of approximately $126.37B. The company’s diverse segments, including Aerospace and Building Technologies, contribute to a robust market share, although competitive pressure from both established firms and new entrants is notable. Technological disruption, particularly in automation and environmental solutions, poses ongoing challenges, yet Honeywell’s commitment to innovation and adaptation positions it favorably for sustained growth. As I analyze its performance, I remain cautious of these dynamics while recognizing the company’s strong foundation and strategic initiatives.
Revenue by Segment
The following chart illustrates Honeywell International Inc.’s revenue breakdown by segment for the fiscal year 2024, highlighting key areas of growth and performance.
In FY 2024, Honeywell’s Aerospace segment continues to lead with $15.46B, reflecting its critical role in driving overall revenue. Home and Building Technologies also showed robust performance at $8.26B, while Safety and Productivity Solutions contributed $10.05B. Notably, Energy and Sustainability Solutions generated $6.43B, marking a significant focus on sustainable innovation. Compared to FY 2023, the Aerospace segment experienced solid growth, while the other segments showed varied performance. The recent year’s results indicate a potential slowdown in growth rates, emphasizing the need for strategic risk management amidst fluctuating market conditions.
Key Products
Honeywell International Inc. offers a diverse range of products across several key segments. Below is a table summarizing some of their main offerings:
| Product | Description |
|---|---|
| Auxiliary Power Units | Essential for aircraft, these units provide power to start engines and supply electricity during ground operations. |
| Integrated Avionics | Advanced systems that enhance flight safety and navigation, integrating multiple functions into a single interface. |
| Building Management Software | Applications designed for optimizing energy usage and enhancing control over building operations, ensuring efficiency. |
| Safety Footwear | Protective footwear designed for industrial environments, ensuring safety and comfort for workers. |
| Cloud-based Notification Systems | Solutions that provide real-time emergency messaging and notifications for critical situations in various settings. |
| Catalysts and Adsorbents | Specialized materials used in industrial processes to enhance productivity and reduce emissions, contributing to sustainability. |
| Personal Protection Equipment | A range of safety gear and apparel aimed at protecting workers in hazardous environments, ensuring compliance with safety standards. |
These products exemplify Honeywell’s commitment to innovation and excellence across diverse industries, from aerospace to building technologies and safety solutions.
Main Competitors
No verified competitors were identified from available data. However, Honeywell International Inc. holds a significant market presence as a diversified technology and manufacturing company with an estimated market share of around 10% in the industrials sector. The company’s broad range of offerings positions it as a strong player in multiple niches, demonstrating sector dominance particularly in aerospace, building technologies, and safety solutions.
Competitive Advantages
Honeywell International Inc. (HON) boasts a diverse portfolio across multiple industries, providing a robust competitive edge. Its innovative technologies in aerospace, building automation, and safety solutions position it well for future growth. The company is actively pursuing opportunities in advanced materials and energy-efficient technologies, which are increasingly in demand due to global sustainability efforts. With ongoing investments in research and development, Honeywell is set to launch new products that cater to emerging markets, ensuring a strong foothold for years to come.
SWOT Analysis
The purpose of this analysis is to evaluate the strengths, weaknesses, opportunities, and threats facing Honeywell International Inc. (HON) to inform strategic decision-making.
Strengths
- Strong market position
- Diverse product portfolio
- Innovative technologies
Weaknesses
- High dependency on aerospace sector
- Vulnerability to economic downturns
- Complex regulatory environment
Opportunities
- Growth in smart building technologies
- Expansion in emerging markets
- Increasing demand for automation
Threats
- Intense competition
- Supply chain disruptions
- Regulatory changes
Overall, Honeywell’s strong market position and diverse portfolio provide a solid foundation for growth, while vulnerabilities in specific sectors and external threats necessitate a cautious approach. The company should leverage emerging opportunities to bolster its resilience and adaptability in a competitive landscape.
Stock Analysis
Over the past year, Honeywell International Inc. (HON) has experienced notable price movements, with fluctuations reflecting key trading dynamics that have shaped investor sentiment.
Trend Analysis
Analyzing the price change for HON over the past year, the stock has registered a percentage change of -3.21%. This indicates a bearish trend, reinforced by a recent period analysis showing a steeper decline of -9.32% from August 31, 2025, to November 16, 2025. The stock peaked at 240.4 and reached a low of 189.29, suggesting a trend that is currently in deceleration, as indicated by the standard deviation of 11.88.
Volume Analysis
In terms of trading volumes over the last three months, the average volume stood at approximately 22.21M, with a significant average sell volume of 16.20M compared to a buy volume of 6.01M. This demonstrates a seller-dominant activity, as the proportion of buyer volume is only 27.08%. Despite the overall volume trend being bullish, the recent acceleration in seller activity might indicate a cautious investor sentiment and a potential shift in market participation dynamics.
Analyst Opinions
Recent analyst recommendations for Honeywell International Inc. (HON) reflect a cautious optimism. Analysts have rated the stock a B+, indicating a preference for a “buy” stance. The overall score of 3 suggests solid fundamentals, with high marks for return on equity (5) and return on assets (5), though the price-to-book score is lower (1), indicating some valuation concerns. Analysts emphasize Honeywell’s strong cash flow and manageable debt levels as key positives. The consensus for 2025 is a “buy,” suggesting confidence in the company’s growth trajectory despite market fluctuations.
Stock Grades
Honeywell International Inc. (HON) has recently received evaluations from several reputable grading companies, indicating a generally stable outlook for the stock.
| Grading Company | Action | New Grade | Date |
|---|---|---|---|
| TD Cowen | Maintain | Buy | 2025-11-10 |
| Morgan Stanley | Maintain | Equal Weight | 2025-10-28 |
| RBC Capital | Upgrade | Outperform | 2025-10-27 |
| Wells Fargo | Maintain | Equal Weight | 2025-10-27 |
| JP Morgan | Maintain | Neutral | 2025-10-24 |
| Barclays | Maintain | Overweight | 2025-10-24 |
| RBC Capital | Maintain | Sector Perform | 2025-10-24 |
| JP Morgan | Maintain | Neutral | 2025-10-15 |
| Wells Fargo | Maintain | Equal Weight | 2025-10-06 |
| Morgan Stanley | Maintain | Equal Weight | 2025-07-28 |
Overall, the trend in grades for HON shows a mix of maintenance and slight upgrades, with RBC Capital’s upgrade to “Outperform” standing out as a notable positive shift. The majority of analysts maintain a cautious but favorable stance, suggesting consistency in investor sentiment.
Target Prices
The consensus target prices for Honeywell International Inc. (HON) indicate a positive outlook among analysts.
| Target High | Target Low | Consensus |
|---|---|---|
| 258 | 230 | 244.2 |
Analysts expect Honeywell’s stock to reach a consensus price of 244.2, reflecting optimism within a range of 230 to 258.
Consumer Opinions
Consumer sentiment towards Honeywell International Inc. (HON) reveals a mixed bag of experiences, highlighting both strengths and areas for improvement.
| Positive Reviews | Negative Reviews |
|---|---|
| “Innovative products that enhance efficiency.” | “Customer service needs significant improvement.” |
| “Reliable technology with great performance.” | “Prices are higher compared to competitors.” |
| “Strong commitment to sustainability.” | “Occasional product defects reported.” |
Overall, consumer feedback indicates strong appreciation for Honeywell’s innovation and reliability, while concerns about customer service and pricing persist.
Risk Analysis
In evaluating Honeywell International Inc. (HON), it’s crucial to consider various risks that could impact performance and investment decisions.
| Category | Description | Probability | Impact |
|---|---|---|---|
| Market Risk | Fluctuations in market demand for industrial products | High | High |
| Regulatory Risk | Changes in environmental regulations affecting operations | Medium | High |
| Supply Chain Risk | Disruptions in supply chains due to geopolitical issues | High | Medium |
| Competition Risk | Increased competition from emerging technologies | High | Medium |
| Cybersecurity Risk | Threats to data integrity and operational technology | Medium | High |
The most pressing risks for HON include market and cybersecurity risks, which could significantly impact revenue and operational stability. Recent trends in supply chain disruptions and regulatory changes further compound these concerns.
Should You Buy Honeywell International Inc.?
Honeywell International Inc. (HON) has demonstrated strong financial performance with a net margin of 14.8%, a return on invested capital (ROIC) of 11.1%, and a weighted average cost of capital (WACC) of 7.16%. The company benefits from a diverse portfolio of flagship products across various sectors and has maintained a competitive edge through innovation, though it faces risks from market volatility and increased competition.
Given the current net margin of 14.8% and a ROIC significantly above the WACC, along with a positive long-term trend, I find that Honeywell appears favorable for long-term investors. However, recent buyer volumes have been overshadowed by seller dominance, suggesting that it may be prudent to wait for a more favorable volume environment before making a purchase.
Specific risks to consider include heightened competition in its industry and potential supply chain challenges which could impact profitability.
Disclaimer: This article is not financial advice. Each investor is responsible for their own investment decisions.
Additional Resources
- Honeywell International Inc. $HON Shares Bought by Cornerstone Advisors LLC – MarketBeat (Nov 16, 2025)
- Honeywell International Stock Outlook: Is Wall Street Bullish or Bearish? – Yahoo Finance (Nov 11, 2025)
- Creative Planning Sells 2,781 Shares of Honeywell International Inc. $HON – MarketBeat (Nov 16, 2025)
- Barclays Raises Honeywell (HON) PT After Q3 Earnings – Yahoo Finance (Oct 27, 2025)
- Honeywell International Inc. $HON Shares Sold by Rockefeller Capital Management L.P. – MarketBeat (Nov 16, 2025)
For more information about Honeywell International Inc., please visit the official website: honeywell.com
