Deutsche Bank Reaffirms “Buy” Rating on Honeywell (HON)

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Diversified technology and manufacturing company Honeywell International Inc. ( HON ) saw its "Buy" rating reiterated on Thursday by analysts at Deutsche Bank.

The firm also reaffirmed its $54 price target HON, which represents a 26% upside to the stock's Wednesday closing price of $42.75. Deutsche Bank noted that the company's Honeywell Process Solutions ( HPS ) division has further growth opportunities as it rises from the ashes of the economic recession.

A Deutsche analyst commented, "HPS is too small to move the needle for HON, but it becomes important as a microcosm for the product innovation and quality improvements implemented under CEO Dave Cote…. Contrary to the perception of widespread market share losses and an uncompetitive product offering, we believe HON did a credible job painting a picture of a stable growth business that has retooled its product and market footprint - a view endorsed by several customer testimonies… Going forward, HON sees opportunities from leveraging sister-company UOP's installed base, expanding into smaller control systems, increasing penetration of wireless control devices, and a clear trend towards energy efficiency…"

Honeywell shares fell 25 cents, or -0.6%, in premarket trading Thursday.

The Bottom Line
We had recently removed shares of HON from our recommended list back on May 19, when the stock was trading at $44.72. The company has a 2.83% dividend yield, based on last night's closing stock price of $42.75. The stock has technical support in the $38-$40 price area. If the shares can firm up, we see overhead resistance around the $46-$47 price levels. We would remain on the sidelines for now.

Honeywell International Inc. ( HON ) is not recommended at this time, holding a Dividend.com DARS™ Rating of 3.4 out of 5 stars.

Be sure to visit our complete recommended list of the Best Dividend Stocks , as well as a detailed explanation of our ratings system here .



The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.

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Referenced Stocks: HON , HPS

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