Here's Why Honeywell Stock Popped Higher Today
Investors are getting excited about the final part of the company's breakup.
Here's Why Honeywell Stock Popped Higher Today
Overview
Honeywell International's (NASDAQ: HON) stock rose by 4.4% at 12:30 pm today on the news that its board of directors had formally approved the spinoff of Honeywell Aerospace.
This is the final stage in the company's breakup, and will create a focused aerospace and defense company, Honeywell Aerospace, with the legacy Honeywell International company remaining as Honeywell Technologies, a focused building, process, and industrial automation company. The split matters because it creates two more focused companies, each with its own risk profile, capital requirements, and industry cycles. For reference, Honeywell also recently had an initial public offering (IPO) for its quantum computing business, Quantinuum.
Details
Both companies are well placed to do well. Honeywell Aerospace's electronics, controls, and power systems make it a leading player in the commercial aerospace and defense markets, and it's a beneficiary of a resurgent growth in commercial travel and a global ramp-up in defense spending driven by geopolitical conflict. Management recently held an investor day and called for compound annual sales growth of 6%-8% through 2030, with earnings growth above sales growth and cash flow above earnings growth.
Source
Originally published at www.fool.com.
