Honeywell International (NYSE:HON) & General Electric (GE) Critical Analysis
Honeywell International (NYSE: HON) and General Electric (NYSE:GE) are both large-cap multi-sector conglomerates companies, but which is the better investment? We will contrast the two businesses based on the strength of their analyst recommendations, valuation, earnings, profitabiliy, dividends, risk and institutional ownership.
Honeywell International pays an annual dividend of $2.66 per share and has a dividend yield of 1.9%. General Electric pays an annual dividend of $0.96 per share and has a dividend yield of 3.8%. Honeywell International pays out 41.2% of its earnings in the form of a dividend. General Electric pays out 118.5% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Honeywell International has increased its dividend for 6 consecutive years.
Volatility & Risk
Honeywell International has a beta of 0.94, suggesting that its stock price is 6% less volatile than the S&P 500. Comparatively, General Electric has a beta of 1.21, suggesting that its stock price is 21% more volatile than the S&P 500.
Institutional and Insider Ownership
76.4% of Honeywell International shares are owned by institutional investors. Comparatively, 54.3% of General Electric shares are owned by institutional investors. 1.6% of Honeywell International shares are owned by insiders. Comparatively, 0.4% of General Electric shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.
This table compares Honeywell International and General Electric’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Earnings and Valuation
This table compares Honeywell International and General Electric’s top-line revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Honeywell International||$39.36 billion||2.68||$7.85 billion||$6.45||21.50|
|General Electric||$118.85 billion||0.01||$17.92 billion||$0.81||31.56|
General Electric has higher revenue and earnings than Honeywell International. Honeywell International is trading at a lower price-to-earnings ratio than General Electric, indicating that it is currently the more affordable of the two stocks.
This is a breakdown of recent ratings and target prices for Honeywell International and General Electric, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Honeywell International currently has a consensus price target of $139.47, suggesting a potential upside of 0.57%. General Electric has a consensus price target of $29.80, suggesting a potential upside of 16.59%. Given General Electric’s higher probable upside, analysts plainly believe General Electric is more favorable than Honeywell International.
Honeywell International beats General Electric on 11 of the 17 factors compared between the two stocks.
About Honeywell International
Honeywell International Inc. is a technology and manufacturing company. The Company operates through four segments: Aerospace, Home and Building Technologies, Performance Materials and Technologies, and Safety and Productivity Solutions. The Company’s Aerospace segment supplies products, software and services for aircraft and vehicles that it sells to original equipment manufacturers (OEMs) and other customers. The Home and Building Technologies segment provides products, software, solutions and technologies that help owners of homes stay connected and in control of their comfort, security and energy use. The Performance Materials and Technologies segment is engaged in developing and manufacturing materials, process technologies and automation solutions. The Safety and Productivity Solutions segment is engaged in providing products, software and connected solutions to customers that manage productivity, workplace safety and asset performance.
About General Electric
General Electric Company is a global digital industrial company. The Company’s products and services range from aircraft engines, power generation, and oil and gas production equipment to medical imaging, financing and industrial products. Its segments include Power, which includes products and services related to energy production and water reuse; Renewable Energy, which offers renewable power sources; Oil & Gas, including liquefied natural gas and pipelines; Aviation, which includes commercial and military aircraft engines, and integrated digital components, among others; Healthcare, which provides healthcare technologies in medical imaging, digital solutions, patient monitoring and diagnostics, and drug discovery, among others; Transportation, which is a supplier to the railroad, mining, marine, stationary power and drilling industries; Energy Connections & Lighting, which includes Energy Connections and Lighting businesses, and Capital, which is a financial services division.
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