Honeywell knows a smart energy system is a more efficient one

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

Further, as the U.S./global economic recoveries strengthen in FY2010, 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.

If you missed the $28 entry point, this is probably your last chance to buy HON's shares and earn an outsized gain during this economic expansion, assuming a U.S./global recovery by Q4. The First Call FY2009/FY2010 EPS estimates for HON are $2.78 to $2.69.

Technically, Honeywell's stock chart is strong: an uptrend, with only minor, constructive corrections. HON broke through resistance at $40 about a month ago, and the stock's recent 10% pull-back represents a Buy opportunity.

Stock Analysis: Honeywell International is a moderate-risk stock. If you've already purchased the company's shares, hold them. If not, consider buying a 50% position in HON now; then buy another 25% in one month, 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 December 2009. Sell/Stop Loss if you were to buy shares in this company: $14.75

Disclosure: Lazzaro has no positions in stocks, but does own shares in two Pimco Bond Funds: PHDAX and PYMAX.