Honeywell elevated to ‘top pick’ status at UBS

UBS analyst Amit Mehrotra elevated Honeywell (HON) to “top pick” status in diversified industrials, joining 3M (MMM) and Johnson Controls (JCI), while keeping a Buy rating on the shares with a $265 price target. The firm cites the company’s good management of expectations, “encouraging” underlying growth, and valuation that it views as having “meaningful room for improvement” for the elevation. UBS has high confidence in Honeywell’s ability to achieve its recently raised earnings guidance, which it notes now includes 18c of “contingency” for demand destruction that may or may not come. The company’s Aerospace and Building Automation businesses continue to show encouraging demand tends, the analyst tells investors in a research note.