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Analytical review of the stocks of Honeywell International Inc. on 03.03.2016

Honeywell International Inc., #HON [NYSE]
Industrial goods, diversified, USA

Financial performance of the company:

Index – S&P 500;
Beta – 1.14;
Capitalization – 81.92 В;
Return on asset – 10.20%;
Income - 4.77 B;
Average volume – 4.27 М;
P/E - 17.63;
ATR – 2.59.


Analytical review:

  • The company ranks the third on capitalization in the sector of “Industrial products” among the issuers traded in the American stock market.
  • On 29 January the company reported for the fiscal year 2015. According to the press release, in the reporting period net profit of the company has grown by 12.5%, from 4.24 billion USD tо 4.77 billion USD). In Q4 the rise of EPS (earnings per share) amounted to 1.53 USD. Analysts expected the value of 1.60 USD.
  • At the press-conference company’s management announced that due to weak USD in the reporting period the company’s revenue fell by 4.3% from 40.30 billion USD to 38.58 billion USD.
  • The company issued forecast for the fiscal years of 2016-2017. It is expected that sales volume will increase by 9.3-11.9% up to 42.2-43.2 billion USD by 2017. Analysts believe that the increase will reach the level of 41.89 billion USD. In the fiscal year of 2016 company’s executives expect the rise of EPS (annual) up to 6.45-6.70 USD.
  • Currently, company’s stocks are traded in the range of 106-107 USD. Large investment funds and banks (Stifel, Argus, Barclays) predict the rise in the company’s quotes up to 113-120 USD.

Summary:

  • Company’s report for Q4 of the fiscal year 2015 showed that management of the company is on the right track. Despite pressure caused by the strong USD the company’s net profit has grown significantly. Optimistic forecast for the fiscal years 2016-2017 increases investors’ confidence to the company. Large investors predict positive dynamics of the company’s stocks.
  • We expect that in the near future company’s quotes will go up.

Trading tips for CFD of Honeywell International Inc.

Long-term trading:
at the moment the issuer has broken down resistance level of 105.90 USD. If the price maintains the levels of 104.10-105.90 USD and in case of the respective confirmation (such as pattern Price Action), we recommend to open long positions. Risk per trade is not more than 1% of the capital, as volatility on the instrument is very high. Stop order can be placed at the level of 104.00 USD. Take profit can be placed in parts at the levels of 109.50 USD, 112.00 USD and 114.50 USD with the use of trailing stop.


Short-term trading: on the chart with the timeframe 15M the issuer is traded between the local support and resistance levels of 105.40-107.50 USD. After breaking out and testing of these levels we recommend to enter the market. Risk per trade is not more than 2.5% of the capital. Stop order can be opened near the signal line and the nearest support/resistance levels. Take profit can be placed in parts of 50%, 30% and 20% with the use of trailing stop.




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