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Honeywell first-quarter profit falls 38% |
Full-year outlook reduced on softer demand; shares trade lower
By Christopher Hinton, MarketWatch
Last update: 9:53 a.m. EDT April 24, 2009
NEW YORK (MarketWatch) -- Honeywell International Inc. lowered its full-year profit outlook Friday as first-quarter earnings fell 38% on softer demand in the company's commercial aerospace, automotive and specialty materials markets.HON 31.60, -0.78, -2.4%) reported earnings that fell to $397 million, or 54 cents a share, from $643 million, or 85 cents a share, in the year-ago period.
The maker of aerospace, transportation and automated-control products said quarterly sales fell to $7.57 billion from the prior year's $8.9 billion.
Analysts polled by FactSet Research had been looking for Honeywell to earn 55 cents a share on sales of $7.5 billion, on average.
Chief Executive Dave Cote said he anticipates the first half of 2009 will be difficult.
For the full year, Honeywell lowered its earnings outlook to the range of $2.85 to $3.20 a share, down from a prior range of $3.20 to $3.55 a share given in January. The FactSet-derived analyst consensus stands at $3.02 a share.
"With a roughly in-line quarter, lowered guidance appears reasonable, underscoring opportunity for investors, given Honeywell's significant discount to peers," said Oppenheimer & Co. analyst Christopher Glynn.
Glynn has an outperform rating on the stock with a price target of $38.
Honeywell's shares "remain a distinctive value in our view," Glynn wrote in a note to investors. He noted that they're trade at an earnings multiple of 11.4 times, saying that this is at "the low end" of revised guidance for earnings.
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