CEO Dave Cote said he is very bullish on aerospace. Honeywell's aerospace segment makes up about 32% of its total sales. He said he looks at macro trends such as what is likely to happen over decades. Cote doesn't see a future where planes aren't a bigger piece of the overall pie as the world becomes more wealthy, especially in GDP per capita. Families are more dispersed, businesses become more global, and cars can't get you to those places.
His company is paying attention to China, Cote said. China became Honeywell's second-biggest country for sales in 2013. Economic statistics in China aren't wholly reliable, but Honeywell is bullish on the country, with organic growth of 13% in the fourth quarter of 2013.
Cote also touted Honeywell's turbocharger business, which utilizes the company's technology in jet engines with fuel efficiency implications for automobiles.
Executive Decision: Doug Parker
Cramer has avoided recommending airlines until recently. But with just four carriers handling 80% of domestic flights, he thinks airlines are a great buy now, none more so than the new American Airlines Group (AAL).
CEO Doug Parker said the airline industry is night and day different from a generation ago. Through a number of mergers, the industry can now provide a scale that makes sense and get passengers where they want to go efficiently. It's now a business that works for investors and customers.
We can always fill airplanes, Parker said. The question is, can we fill the seat at a level that covers the cost of flying that seat around? Parker said that's what the company has done poorly in the past, and that's what it's trying to doing better now.