Honeywell Outlook - A Bearish Signal Amid Mixed Analyst Expectations

Market Snapshot

Honeywell (HON) is currently in a weak technical position, with bearish signals clearly dominating and suggesting investors should consider avoiding the stock at this time.

News Highlights

• May 29, 2025: Changes to U.S. policy on the approval and recommendation of COVID-19 vaccines are likely to affect public health and economic activity, though direct impact on Honeywell is not clear.
• May 31, 2025: President Trump fast-tracked a uranium mine in Utah, potentially indicating a shift toward resource independence. However, industry revival is expected to be price-dependent.
• May 31, 2025: China's factory activity saw a slight improvement, rising from 49.0 in April to 49.5 in May. This may indirectly affect global manufacturing demand, but the overall trend remains weak.

Analyst Views & Fundamentals

Analyst Ratings

The simple average analyst rating is 3.25 (on a 1-5 scale), while the performance-weighted rating is 4.32. These scores suggest a slightly optimistic outlook, though not strongly aligned with the recent price drop of -3.66%. Analysts are divided, with three "Neutral" ratings and one "Buy" recommendation over the last 20 days.

Fundamental Performance

Key fundamental factors and their internal diagnostic scores (0-10) include:

• Net profit attributable to parent company shareholders / Net profit (%): 99.44% (Score: 1.00)
• Net assets per share (growth rate compared to beginning of year %): -11.53% (Score: 3.00)
• Operating profit margin (GPM): 38.86% (Score: 2.00)
• GMAR: 38.86% (Score: 2.00)
• Income tax / Total profit (%): 19.15% (Score: 3.00)
• Shareholders' equity attributable to parent company (growth rate compared to beginning of year %): -13.56% (Score: 2.00)
• Interest coverage ratio (EBIT / Interest expense) (%): 7.10% (Score: 4.00)

The overall fundamental score is 6.84, indicating mixed performance with some financial metrics showing strength while others decline.

Money-Flow Trends

Big-money investors appear cautiously optimistic, with an overall inflow ratio of 0.65. Large and extra-large investors are showing a positive trend (65.5% inflow), while medium investors have a negative trend. Retail investors, on the other hand, are more active with a positive Small_trend (0.50 inflow ratio), suggesting some retail optimism.

The overall fund flow score is 8.71 (Excellent), indicating strong inflows at the institutional level despite the recent price decline.

Key Technical Signals

Internal Diagnostic Scores for Technical Indicators

• WR Oversold: Internal strength score of 3.8 (suggests moderate bearish pressure).
• MACD Death Cross: Internal strength score of 1.0 (a strong bearish signal).
• Dividend Payable Date: Internal strength score of 1.0 (another bearish signal).

Recent Chart Patterns

Key technical events include:

• 2025-09-10: WR Oversold
• 2025-09-12: WR Oversold
• 2025-09-03: WR Oversold
• 2025-09-05: WR Oversold, Dividend Payable Date
• 2025-09-04: MACD Death Cross

These patterns reinforce the bearish outlook, with three out of three indicators signaling weakness. The technical score is 1.93, and the analysis suggests the stock is in a weak state with a high risk of further decline.

Conclusion

Honeywell faces a challenging technical environment with three bearish signals and a weak trend. While institutional money is flowing in, the price has fallen significantly, and the fundamentals show mixed performance. The best strategy at this time may be to consider avoiding HON and waiting for a more favorable entry point. Investors should monitor analyst activity and potential earnings surprises for future clues about the stock’s direction.