Honeywell forecasts 2017 earnings largely below expectations

Aerospace parts maker Honeywell International Inc. said on Friday it expected fourth-quarter earnings per share to be at the low end of its previous forecast, and also estimated its 2017 earnings to be largely below estimates.
Honeywell’s disappointing outlook follows a drab third-quarter performance in October when it cut the top end of its 2016 profit forecast citing “more difficult than anticipated” conditions in the business jet market.
The company — which makes parts for business-jet makers Bombardier Inc, Textron Inc. and General Dynamics Corp. — is also undergoing a management reshuffle, with Chief Operating Officer Darius Adamczyk taking over as chief executive from longtime CEO David Cote, effective March 31.
“Sentiment around Honeywell is as negative as it’s been in years following the 3Q miss and ongoing uncertainty about the direction of earnings as the CEO transition plays out,” J.P. Morgan analyst Stephen Tusa said in research note on Thursday.
Honeywell said it expects fourth-quarter earnings of about $1.74 per share, compared with its previous forecast of $1.74-$1.78.
The company also forecast 2017 earnings per share of $6.85-$7.10, compared with the average analysts’ estimate of $7.08 per share, according to Thomson Reuters I/B/E/S.
The Morris Plains, New Jersey-based company expects its 2017 organic sales growth rate to improve for the first time in three years.
Honeywell forecast 2017 organic sales to grow in a range of 1-3 percent. The growth rate was up 3 percent in 2014, 1 percent in 2015 and is expected to be down 1-2 percent in 2016.
Up to Thursday’s close, Honeywell’s stock had risen about 13 percent this year, compared with a 10.2 percent rise in the S&P 500 index

Source: Arab News