Honeywell (HON) Secures New Orders for Helicopter Engines
Industrial goods manufacturer Honeywell International Inc. HON recently secured fresh orders for its HTS900 helicopter engines from Eagle Copters Ltd., a Canadian firm that offers complete fleet management support to operators since 1975. Eagle Copters has currently placed an order for eight HTS900 helicopter engines to take its total tally to 10 such engines.
The continued order patterns signify a growing importance for Honeywell engines that promise a 17% reduction in fuel consumption compared with the standard engines. In addition, these engines provide a 22% increase in shaft horsepower compared with other available variants in the market, making it ideal for lifting heavy loads under hot-and-high flying conditions.
The improved performance metrics is a culmination of Honeywell’s technological prowess that has produced a new engine design. This remodelled design pattern has fortified the engines with extended capacity of an additional 500 pounds of payload, improved dash speed and 12% lower maintenance costs compared with the original Bell 407 engines. In addition, the engines are equipped with the latest technologies that include a dual centrifugal compressor, cooled single-crystal turbine blades, effusion-cooled combustor liner and a dual-channel, full authority digital engine control.
Earlier, Honeywell and Eagle Copters formed a strategic partnership to improve upon the performance of the existing engines of Bell 407 helicopters. Titled Eagle 407HP, the program used the original design and engineering excellence from Bell Helicopter to tweak the requisite parameters for better efficacy. While Honeywell provided the HTS900 engine and configuration, Eagle Copters provided the aircraft, engine installation, and flight-testing and certification procedures. The collaboration managed to get the Supplemental Type Certificate from the Federal Aviation Administration and Transport Canada certification covering the retrofit program in 2014.
With such state-of-the-art products, Honeywell aims to gain a competitive edge over its rivals and augment its revenues. Incidentally, the company has outperformed the Diversified Operations industry in the last three months with an average return of 8.7% compared with just 0.8% gain for the latter.
Based in Morris Township, NJ, Honeywell manufactures a wide range of aerospace products and services, including control, sensing and security technologies for buildings, homes and industry; turbochargers; automotive products; specialty chemicals; electronic and advanced materials; process technology for refining and petrochemicals; and energy efficient products and solutions for homes and business. The Aerospace division of Honeywell develops indigenous technologies for air traffic modernization, flight and runway safety, engines, cockpit and cabin electronics, connectivity, and logistics for safe, efficient, productive and comfortable transportation-related experiences.
Honeywell currently has a Zacks Rank #3 (Hold). Some better-ranked stocks in the industry include Hitachi, Ltd. HTHIY, Swire Pacific Limited SWRAY and Barloworld Limited BRRAY, each carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Hitachi has a long-term earnings growth expectation of 13% and is currently trading at a forward P/E of 13.3x.
Swire Pacific is currently trading at a forward P/E of 15.8x.
Barloworld has a long-term earnings growth expectation of 18.7% and is currently trading at a forward P/E of 11.0x.
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