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General information
Honeywell International Inc. is a worldwide technology and manufacturing company. The Company provides aerospace products and services, control, sensing and security technologies for commercial buildings, safety and productivity solutions, specialty chemicals, advanced materials, process technology for refining and petrochemicals, and energy efficient products and solutions.
  • Bad financial results growth rate -29.5% (average between last period year over year growth for revenue and EBITDA), there is slowdown compared to average historical growth rates (-1.8%)
  • Dividend yield for the last twelve months 2.3%
  • Free cash flow yield 4.5% (LTM)
  • Share price is 55.0% higher than minimum and 12.0% lower than maximum for the last 3 years
  • The company is undervalued by EV / LTM EBITDA multiple compared to target level (16.9x vs 17.1x)
  • Fundamental value created in LTM (estimate) -52.4%
Key Financials
Ticker: HON
Share price, USD: 161.16
Common stocks: 714 533 499

Dividend Yield:  2.3%
FCF Yield LTM: 4.5%
EV / LTM EBITDA: 16.9x
Last revenue growth (y/y):  -19.1%
Last growth of EBITDA (y/y):  -40.0%
Historical revenue growth:  -3.8%
Historical growth of EBITDA:  0.3%
Target EV / EBITDA (hist 75% percentile): 17.1x
Fundamental value created in LTM: -52.4%
EV / LTM EBITDA mutiple calculation
Market Cap ($m): 115 154
Net Debt ($m): 7 948
EV (Enterprise Value): 123 102
EBITDA LTM ($m): 7 293
EV / LTM EBITDA: 16.9x

Revenue and EBITDA

Quarterly values ($m)

Change (y/y)

Cash Flow

Free Cash Flow ($m)

Net Debt / Cash and Equivalents ($m)

Share price and dividends

Share price

Payment USD per share

Multiple and potential

EV / LTM EBITDA and 75% percentile

Potential dynamics

Value Creation

Fundamental Value Creation is calculated as ratio of value created in the last period to current market cap of the company.

The fundamental value can be created in two ways:
• cash generation in form of dividend payments or debt reduction or share buybacks
growth of the company enterprise value through improving financial results

The growth of enterprise value in the last period is estimated as product of:
• annualized increase of EBITDA in the last reporting period year over year
• relevant EV/EBITDA multiple (average between actual EV/EBITDA for the company and average general level of 10.0x is applied)

Parameter
#
Formula
Value
    
    
            EBITDA (pre LTM Q)
(1)
2 113
            EBITDA (last Q)
(2)
1 268
            EBITDA LTM
(3)
7 293
    
    
        EBITDA LTM / last Q
(4)
(3) / (2)
5.752
    Gain of EBITDA (mln $)
(5)
( (2)-(1) ) * (4)
-4 860
    
    
            EV
(6)
123 745
        Mult
(7)
(6) / (3)
17.0x
        Mult common
(8)
const
10.0x
    Mult avg
(9)
avgerage
13.5x
    
    
    Equity+
(10)
(5) * (9)
-65 533
    FCF LTM
(11)
5 212
    
    
Value+
(12)
(10) + (11)
-60 321
Cap
(13)
115 154
    
    
Fundamental value creation
(14)
(12) / (13)
-52.4%

Potential

EBITDA LTM       7 293
 
EBITDA E       6 189
Mult aim       17.1x
 
EV E       105 607
NetDebt corr       6 863
 
Cap E       98 744
Cap       115 154
Growth potential            -14.3%