Analysts’ consensus on Honeywell

In the past two months, the number of analysts covering Honeywell (HON) stock reduced from 21 analysts to 19 analysts. Among them, 79% of the analysts recommended the stock as a “buy,” 21% recommended the stock as a “hold,” and none of the analysts recommended the stock as a “sell” as of September 6, 2017.

How Much Upside Do Analysts See for Honeywell?

Honeywell’s mean target price, recommended by analysts’ consensus, stands at $144.44 over the next 12 months. Its target price implies a return potential of ~5.8% from the closing price of $136.55 as of September 6, 2017.

Many analysts stick to a “buy” or “hold”

In the first two quarters, Honeywell reported better-than-expected earnings and managed to beat analysts’ estimates. Honeywell made an upward revision to the lower end of its EPS (earnings per share) for fiscal 2017 to $7.0–$7.10—compared to the earlier guidance of $6.90–$7.10. All of these factors would have influenced analysts to recommend the stock as a “buy” or a “hold.”

Recommendations from individual brokerage firms

  • Morgan Stanley (MS) recommended a target price of $145 for Honeywell, which implies a potential return of 6.20% over the closing price of $136.55 as of September 6, 2017.
  • RBC provided Honeywell with a target price of $148, which implies a return potential of 8.40% from the closing price of $136.55 as of September 6, 2017.
  • Jefferies rated Honeywell as a “buy.” It recommended a target price of $155, which implies a return potential of 13.50% from the closing price of $136.55 as of September 6, 2017.

Investors looking to invest in Honeywell indirectly can invest in the Vanguard Industrials ETF (VIS). VIS has invested 3.60% of its portfolio in Honeywell. The fund’s other top holdings include General Electric (GE), Boeing (BA), and 3M (MMM) with weights of 7.90%, 5.0%, and 4.40%, respectively.

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