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Honeywell Completed the Transnorm Acquisition

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Honeywell acquired Transnorm

In a press release on November 9, Honeywell (HON) announced that it completed the acquisition of German-based Transnorm. Honeywell entered into an agreement on October 1 to acquire Transnorm. According to the deal, Honeywell will pay 425 million euros.

The impact of the acquisition will likely be visible in the fourth-quarter revenues. Transnorm is expected to be part of Honeywell’s Safety and Productivity Solutions. Transnorm is expected to complement Honeywell’s Intelligrated business.

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John Waldron, the president and CEO of Honeywell’s Safety and Productivity Solutions business, said, “Transnorm is an excellent addition to our portfolio of warehouse automation solutions, and will help us better support European distribution centers and parcel delivery providers that are responding to significant e-commerce growth. Our Connected Distribution Center offering delivers higher throughput, greater flexibility and better visibility into real-time operations to give our customers the ability to make better business decisions.”

Stock price movement

Honeywell remained positive. The stock gained 3.3% and closed at $150.32 for the week ending November 9. The gains resulted in the trend reversal in Honeywell’s 100-day moving average price. The stock traded 0.5% above the 100-day moving average price of $149.50. Honeywell outperformed the Invesco Aerospace & Defense ETF (PPA), which rose ~3.1%. PPA invests 7.1% of its portfolio in Honeywell.

On a year-to-date basis, Honeywell has gained 2.3% after spinning two companies. United Technologies (UTX), Textron (TXT), and Boeing (BA) have risen 2.5%, 0.5%, and 25.2%, respectively.

The company’s 14-day RSI (relative strength index) is at 53, which indicates that the stock is very close to being overbought. An RSI of 70 and above shows that a stock has temporarily moved into the “overbought” position, while an RSI of 30 and below indicates that a stock has temporarily moved into the “oversold” position.

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