NEW YORK (TheStreet) -- Honeywell International (HON) - Get Honeywell International Inc. Report is said to have completed its approximate $5.1 billion acquisition of meter business Elster, Dow Jones reports. Elster was a division of the British manufacturing business Melrose Industries.
Just last week Honeywell announced that it received all the necessary regulatory approval needed to complete the acquisition, which was announced back in July.
"The acquisition of Elster adds outstanding technologies, strong well-recognized brands, energy efficiency know-how, and a global presence to the Honeywell portfolio," Honeywell CEO Dave Cote said in a statement announcing the regulatory approval.
"We see Elster as a great opportunity to deploy HOS Gold to drive new growth and greater profitability in each of Elster's businesses. This acquisition is expected to generate strong future returns for our shareowners, consistent with what you have come to expect from Honeywell," Cote continued.
Shares of Honeywell International closed lower by 0.31% to $104.33 on Monday afternoon.
Recently, TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author. TheStreet Ratings has this to say about the recommendation:
We rate HONEYWELL INTERNATIONAL INC as a Buy with a ratings score of A-. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its growth in earnings per share, increase in net income, good cash flow from operations, solid stock price performance and largely solid financial position with reasonable debt levels by most measures. 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:
- 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.
- Net operating cash flow has increased to $1,666.00 million or 35.11% when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of 20.70%.
- After a year of stock price fluctuations, the net result is that HON's price has not changed very much. Although its weak earnings growth may have played a role in this flat result, don't lose sight of the fact that the performance of the overall market, as measured by the S&P 500 Index, was essentially similar. 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.
- 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.
- You can view the full analysis from the report here: HON