In this chart of HON, above, we can see how HON held up well in 2015 and only in late August did it make a quick shakeout to the downside. It quickly recouped half of the decline in a rebound to the 50-day Moving Average. There was a retest of the August decline, which was followed by a rally to the September highs and then another dip before shooting over the September highs. The On-Balance-Volume (OBV) line has improved with the price action.
In this longer look at HON, above, we can see a strong rally with only quick and shallow corrections. The OBV line is flat, but prices are back over the 40-week MA. The Moving Average Convergence Divergence oscillator is generating a bullish crossover from below the zero line. Considering the short-term and long-term technicals for HON, we anticipate that HON will try to push up to new 52-week highs before the end of 2015.
Separately, TheStreet Ratings team rates HONEYWELL INTERNATIONAL INC as a Buy with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation:
We rate HONEYWELL INTERNATIONAL INC (HON) a BUY. This is driven by a number of strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its solid stock price performance, growth in earnings per share, increase in net income, largely solid financial position with reasonable debt levels by most measures and notable return on equity. We feel its strengths outweigh the fact that the company shows low profit margins.
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- The stock has not only risen over the past year, it has done so at a faster pace than the S&P 500, reflecting the earnings growth and other positive factors similar to those we have cited here. Turning our attention to the future direction of the stock, it goes without saying that even the best stocks can fall in an overall down market. However, in any other environment, this stock still has good upside potential despite the fact that it has already risen in the past year.
- HONEYWELL INTERNATIONAL INC has improved earnings per share by 8.8% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, HONEYWELL INTERNATIONAL INC increased its bottom line by earning $5.33 versus $4.92 in the prior year. This year, the market expects an improvement in earnings ($6.10 versus $5.33).
- The company, on the basis of net income growth from the same quarter one year ago, has significantly outperformed against the S&P 500 and exceeded that of the Aerospace & Defense industry average. The net income increased by 8.3% when compared to the same quarter one year prior, going from $1,167.00 million to $1,264.00 million.
- The current debt-to-equity ratio, 0.60, is low and is below the industry average, implying that there has been successful management of debt levels. Although the company had a strong debt-to-equity ratio, its quick ratio of 0.89 is somewhat weak and could be cause for future problems.
- The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. In comparison to other companies in the Aerospace & Defense industry and the overall market on the basis of return on equity, HONEYWELL INTERNATIONAL INC has underperformed in comparison with the industry average, but has greatly exceeded that of the S&P 500.
- You can view the full analysis from the report here: HON