Where Will Honeywell Be in 10 Years?
One of the key advantages of investing in an industrial conglomerate like Honeywell (NASDAQ: HON) is that its diverse collection of businesses ensures the company can grow earnings across different economic conditions. However, it's also critically important that those earnings be invested in ways that add future growth. Fortunately, that's precisely what Honeywell's management is doing, and the company is well set for growth in the coming years.
The importance of investing wisely for growth won't be lost on long-term Honeywell investors, and you only have to ask General Electric what it thinks about it to understand the matter. In 2001, during the final throes of the tenure of GE's legendary CEO Jack Welch, GE bid to acquire Honeywell. The bid failed, and Jeff Immelt took over GE only to lead the company to become a shadow of its former self -- a series of misjudged acquisitions in oil and gas and power while investing heavily in digital capability that ultimately proved premature and unprofitable.
In contrast, the tenure of Dave Cote (a former GE veteran) as CEO of Honeywell (2012-2017) almost overlapped Immelt's and saw a dramatic improvement in the company's fortunes. Current CEO Darius Adamczyk appears to be following in Cote's footsteps, and now Honeywell's $138 billion market cap eclipses GE's $89 billion. Moreover, Honeywell is well placed for long-term growth. Making the right investments matters, and there's evidence to suggest Honeywell's next decade will be as successful as its previous two.
Source Fool.com
