Is HON a good stock to buy now? We came across a bullish thesis on Honeywell International Inc. on R. Dennis’s Substack by OppCost. In this article, we will summarize the bulls’ thesis on HON. Honeywell International Inc.’s share was trading at $235.29 as of March 6th. HON’s trailing and forward P/E were 31.08 and 22.22 respectively according to Yahoo Finance.
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Honeywell International Inc. engages in the aerospace technologies, industrial automation, building automation, and energy and sustainable solutions businesses in the United States, Europe, and internationally. HON is undergoing a transformative shift, moving from a sprawling industrial conglomerate to a focused leader in automation and aerospace.
The upcoming spin-off of Honeywell Aerospace Technologies in the second half of 2026 is a key catalyst, as it is expected to unlock significant shareholder value. Historically, high-quality divisions spun off from conglomerates are awarded higher multiples by the market, and management has emphasized continued strong capital returns, which should support investor confidence.
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With the current stock trading around $221, selling the $200 Puts expiring January 2027 offers a compelling risk-adjusted opportunity. The $11 premium collected per contract creates a break-even of $189, providing a margin of safety of approximately 14.5% below current levels. At that break-even, Honeywell would trade at roughly 18x 2026 estimated earnings, which is attractive given the company’s focus on higher-margin automation and aerospace segments following the recent spin-off of Solstice Advanced Materials.
Even if the stock remains above $200, investors retain the premium, while a drop below $200 allows acquisition of a premier industrial leader at a discounted valuation. Risks include a macro industrial slowdown that could depress aerospace and automation demand, or potential delays in the Aerospace spin-off.
Overall, Honeywell’s strategic repositioning, strong return on equity, and disciplined capital allocation make the company a bullish opportunity for investors seeking upside with defined risk. The spin-off is likely to re-rate the stock as the market recognizes the value of a more focused Honeywell, providing both income from premiums and potential capital appreciation.
Previously, we covered a bullish thesis on GE Aerospace (GE) by Asymmetric Ventures in May 2025, which highlighted the company’s dominant position in aerospace maintenance, repair, and overhaul (MRO) services, predictive maintenance technology, and strong partnerships with Boeing and Airbus. GE’s stock price has appreciated by approximately 33.63% since our coverage. OppCost shares a similar view on Honeywell International Inc. (HON) but emphasizes value creation from the upcoming Aerospace spin-off and the strategic focus on automation and high-margin aerospace segments.
Honeywell International Inc. is not on our list of the 40 Most Popular Stocks Among Hedge Funds. As per our database, 79 hedge fund portfolios held HON at the end of the fourth quarter which was 76 in the previous quarter. While we acknowledge the risk and potential of HON as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than HON and that has 10,000% upside potential, check out our report about this cheapest AI stock.
Disclosure: None.
