Stock price when the opinion was issued
So many moving pieces in the puzzle. 12-month price target of $253, decent runway. Activist Elliott Management has forced a breakup. People get concerned about spinoffs, but thinks it will be fine. Biggest division will be aerospace -- sort of cyclical. Second is automation -- in renewables and so on.
Third division, Advanced Materials, encompasses AI. Pretty small, as only 3-4% of revenues go there. Just announced it's now largest shareholder in Quantinuum, with second-largest being NVDA. Makes it a significant player in quantum computing. On July 24, beat top and bottom and raised guidance. Yield is 2.13%.
Very inexpensive at 19x PE. Great businesses under the hood in terms of aerospace and automation. Catalyst for realizing value over the next 2-3 years is the upcoming spinoff. Post-spinoff, valuations will normalize to what's suitable for the growth of each business according to the industry it's in. Yield is 2.31%.
(Analysts’ price target is $249.14)
It's been caught up in this movement in quasi-industrial stocks with military-government projects, all due to better global growth. The stock has risen since Trump came in, pronouncing "America First." That said, he's concerned with global growth going forward and HON's margin costs. He wouldn't buy it now.