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Honeywell (HON) Boosts Navigation Offerings With New IMUs

Zacks Equity Research

Honeywell International Inc. HON is launching two new inertial measurement units (IMUs) for providing advanced navigation grade performance in a small and lightweight package. Both these IMUs — the HGuide i300 Micro-Electro-Mechanical System IMU and the HG4930 S-Class IMU, which utilize proven inertial sensor technology, serve as advanced precision inertial solution on land, air and sea.

These IMUs with state of the art sensors are designed to meet the requirements of a range of applications across various markets like robotics, aerospace, agriculture, survey/mapping, and transportation. Notably, leveraging gyroscopes, accelerometers and electronics, an IMU helps in providing precise rotation and acceleration data to a control system of a platform. Also, these units allow the system to compute their exact location, direction of travel and speed, even in the absence of GPS signals.

The HGuide i300 IMU’s exceptional small size and light weight along with its low power requirements makes it an appropriate choice for several industrial applications like precision agriculture, autonomous vehicle testing, platform control, pipeline inspections and motion compensation. As noted by the company, this IMU offers a precise and reliable guidance, control and pointing capabilities during most demanding situations. On the other hand, the HG4930 S-Class IMU, which comes as a substitute for Fiber Optic Gyro IMUs, offers a high bandwidth and high data rates for precision stabilization requirements. Moreover, both these units have other user benefits including a range of user-changeable options, multiple and configurable communication protocols and tested ruggedness throughout the unit life.

Our Take

Strength in commercial aftermarket business and strong orders in the U.S. and international defense business are likely to drive Honeywell’s Aerospace segment’s revenues in the quarters ahead. Also, solid demand for commercial fire and security products is likely to continue bolstering revenues of Building Technologies segment. Further, the company believes that strong demand for its warehouse automation, sensing and IoT businesses will boost Safety and Productivity Solutions segment’s revenues.

Year to date, Honeywell’s shares have gained 27.6% compared with the industry’s growth of 19.8%.

However, softness in the company’s productivity product business due to inventory destocking, fewer large project rollouts in the mobility space and lower channel sell-through, remains a concern. Further, high research and development costs could be a drag on Honeywell’s Aerospace segment’s profitability.

Zacks Rank & Key Picks

Honeywell currently carries a Zacks Rank #3 (Hold).

Some better-ranked stocks in the same space are Federal Signal Corporation FSS, United Technologies Corporation UTX and Carlisle Companies Incorporated CSL. While Federal Signal sports a Zacks Rank #1 (Strong Buy), United Technologies and Carlisle carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Federal Signal surpassed estimates in each of the trailing four quarters, the average positive earnings surprise being 16.48%.

United Technologies outpaced estimates in each of the preceding four quarters, the average earnings surprise being 13.19%.

Carlisle exceeded estimates thrice in the trailing four quarters, the average earnings surprise being 17.16%.

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