Honeywell: Back up the truck, for share gains

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I'm Reiterating my Buy rating for Honeywell International, Inc. (NYSE: HON) first recommended on February 25, 2009 at a price of $28.26.

The growth proposition for Honeywell remains intact. Large order backlogs by commercial airline manufacturers, including The Boeing Company (NYSE: BA), will support revenue in FY2009.




Then, as the U.S./global recoveries commence, look for sales of control instruments -- including those proverbial round thermostats -- to advance smartly: energy-efficiency in a high-price energy world bodes very well for HON, so if you haven't already, back up the truck for HON's shares. The FY2009/FY2010 EPS estimates for HON are $2.83 to $2.80.

If you missed the $28 entry point, you'll have one more chance to buy shares and realize an impressive gain: now, assuming a U.S./global recovery by Q4.

Stock Analysis: Honeywell is a moderate-risk stock. If you've already purchased the company's shares, buy another 25% now. If you didn't, consider buying a 50% position in HON now; then buy another 25% in three months, if U.S. and global economic conditions don't worsen substantially. Under any circumstance, don't buy more than 75% of your HON position before October 2009. Sell/Stop Loss if you were to buy shares in this company: $14.75.

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Disclosure: Lazzaro has no positions in stocks, but does own shares in two Pimco Bond Funds: PHDAX and PYMAX.
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Last updated: February 10, 2010: 03:55 AM

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