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Honeywell International Inc. HON has been actively following its business transformation strategy that aims to unlock values for its shareholders. The company recently announced that it has made significant progress on the possible spinoff of its Aerospace business. It will provide an update on the same when it reports its fourth-quarter 2024 earnings.
In October 2023, HON declared its plan to realign its business segments to three megatrends, which are automation, the future of aviation and energy transition. The company believes that its realignment plan will enable it to optimize its business portfolio and deliver sustained growth.
Honeywell has announced several strategic actions over the past year to boost its organic growth and simplify its business portfolio. This includes some acquisitions made by the company, which have strengthened its business. In October 2024, it acquired Civitanavi Systems S.p.A. for about €200 million ($217 million) to boost its portfolio of aerospace navigation solutions. In September 2024, it acquired CAES Systems Holdings, which will augment its defense technology offerings across various domains, including land, sea, air and space.
Also, in the same month, the company acquired Air Products’ liquefied natural gas (LNG) process technology and equipment business for $1.81 billion. The inclusion of LNG process technology and the equipment business’ expertise in in-house design and manufacturing of coil-wound heat exchangers and related equipment portfolio will boost Honeywell’s energy transition portfolio. This apart, in June 2024, the company acquired Carrier’s Global Access Solutions business for an all-cash deal of $4.95 billion. The buyout of Global Access Solutions will enable HON to expand its security products portfolio and boost its building automation segment.
As part of its business portfolio transformation strategy, it also plans to divest its Advanced Materials business and entered into a deal to spin off its Personal Protective Equipment unit.
HON’s Zacks Rank & Price Performance
Honeywell currently carries a Zacks Rank #3 (Hold). The company is benefiting from strength in its commercial aviation aftermarket business, driven by solid demand in the air transport and business aviation markets.
Image Source: Zacks Investment Research
In the past year, HON stock has gained 15% against the industry’s 9% decline.
However, it has been witnessing weakness in the warehouse and workflow solutions businesses due to lower demand for projects, which has been affecting the Industrial Automation segment's performance.