By Lewis Krauskopf
Jan 24 Honeywell International Inc
reported higher-than-expected fourth-quarter profit and revenue
on Friday, as sales grew across its major segments.
The diversified U.S. manufacturer of aerospace parts and
climate control systems backed its 2014 financial targets, set
last month, but forecast first-quarter earnings below Wall
"While we think it's prudent to remain cautious on the
global economy at this time, we're increasingly confident in our
2014 outlook based on the momentum from the fourth quarter,"
Honeywell Chief Executive Dave Cote said in a statement.
Honeywell shares rose 1 percent to $90.70 in pre-market
Edward Jones analyst Christian Mayes characterized the
results as a "pretty good quarter," and said investors would
likely now focus on the company's investor day in March, when
Honeywell is expected to reveal five-year financial targets.
"That's where the focus where the stock is going to go,"
said Mayes, who rates the shares a "buy." "People will probably
be excited about the numbers that will be revealed, given their
history of doing so well and meeting the last targets."
Honeywell's fourth-quarter net income rose to $947 million,
or $1.19 per share. That is up considerably from $251 million,
or 32 cents per share, a year earlier, when the company recorded
a large pension expense.
Excluding one-time items, Honeywell's earnings of $1.24 per
share beat the average estimate of analysts by 3 cents,
according to Thomson Reuters I/B/E/S.
Revenue increased 8 percent to $10.39 billion, nearly $200
million ahead of estimates.
In its two largest segments, aerospace and automation and
control solutions, profit rose 6 percent and 8 percent,
respectively. Earnings increased 30 percent in its smaller
performance materials and technologies segment, whose products
include chemicals used in oil and gas production.
Analysts were also impressed with the performance of the
company's relatively small transportation systems business,
which makes turbochargers and where profit soared 41 percent.
Honeywell said earlier this month it was selling its
friction materials business, which makes brake pads, to Federal
Mogul Corp for about $155 million.
Edward Jones' Mayes said transportation systems could have
higher profit margins after the sale of the friction materials
Honeywell confirmed its 2014 financial targets, which
include 8 percent to 10 percent growth in earnings per share and
a 3 percent to 4 percent increase in sales.
However, the company forecast first-quarter earnings in a
range of $1.23 to $1.27 per share, below Wall Street's
expectation of $1.29.
Honeywell shares rose 42 percent in 2013, outpacing the