Honeywell (HON) guides up organic growth.
That was the headline, but the nitpickers focused on a comment about 2017 guidance being at the low end of the range -- and I am aghast that someone sold this stock down 10.
You can't make up how lacking in "horse sense" some traders can be. If you looked at the last quarter Honeywell reported, you saw that organic growth -- the key metric for industrials -- was down 3%. The release this morning represented a guide up in organic growth, of a surprising magnitude.
Was the earnings guidance at the low end? No more than 3M's (MMM) was the other day -- and that stock's screaming after being hit.
Plus, as when Janet Yellen outlined her forecast for 2017 -- with an itsy bitsy roughly 100 basis points bump up to 2% and change for the GDP post election -- Honeywell didn't factor in a possible growth spurt. Nor did it factor in some possible tax changes. Given the global nature of Honeywell's business, though, you know that the strong dollar has to rein in earnings.
All in all, this is exactly what I have come to expect from this market. It's in to the total "no homework" phase -- including watching Mad Money, where outgoing CEO Dave Cote came on the show to explain why his last forecast wasn't downbeat; it was actually upbeat with some conservatism thrown in.
This time was no different, which is why HON proceeded to rally and make up all 10 points it shed... and then some.
