Summary
The October sell off has created an attractive opportunity to pick up shares at value levels and a potential 18% return opportunity.
Honeywell has been focusing on all things Aerospace and making an effort to grow their defense product lines.
The company has repurchased $2.3 billion in stock during 2018 and will continue accelerating the buyback at depressed share levels.
Honeywell completed the spin-offs of Homes and Global Distribution named "Resideo" and transportation Turbocharger divisions named "Garrett".
The Opportunity
Honeywell (HON) fared better than peers during the October sell off and only traded down by 13% from all time highs recently reached. The stock is undervalued and the sell off has created an opportunity for shareholders to pick up shares at a great value. Honeywell is growing their top line in the high single digits ~8% and trading to a 19 times forward price to earnings ratio, which appears below fair value of $170 per share. Based upon my share price estimate of $170, the stock has an 18% return potential.
