Honeywell International Inc. (HON)

Free Cash Flow to Equity (FCFE)

Honeywell International Inc., FCFE calculation

USD $ in millions

12 months ended	Dec 31, 2012	Dec 31, 2011	Dec 31, 2010	Dec 31, 2009	Dec 31, 2008
Net income attributable to Honeywell	2,926	2,067	2,022	2,153	2,792
Net income attributable to the noncontrolling interest	5	7	13	36	20
Net noncash charges	1,044	887	2,042	1,307	1,016
Changes in assets and liabilities, net of the effects of acquisitions and divestitures	(458)	(128)	126	450	(37)
Net cash provided by operating activities	3,517	2,833	4,203	3,946	3,791
Expenditures for property, plant and equipment	(884)	(798)	(651)	(609)	(884)
Proceeds from disposals of property, plant and equipment	5	6	14	31	53
Net increase (decrease) in commercial paper	(199)	300	1	(1,133)	(325)
Net increase (decrease) in short-term borrowings	22	(2)	20	(521)	(1)
Payment of debt assumed with acquisitions	–	(33)	(326)	–	–
Proceeds from issuance of long-term debt	102	1,390	–	1,488	1,487
Payments of long-term debt	(1)	(939)	(1,006)	(1,106)	(428)
Free cash flow to equity (FCFE)	2,562	2,757	2,255	2,096	3,693

Item	Description	The company
FCFE	Free cash flow to equity is the cash flow available to Honeywell International Inc.'s equity holders after all operating expenses, interest, and principal payments have been paid and necessary investments in working and fixed capital have been made.	Honeywell International Inc.'s FCFE increased from 2010 to 2011 but then slightly declined from 2011 to 2012.

Honeywell International Inc., current P/FCFE

	Honeywell International Inc.	Industrials
No. shares of common stock outstanding	783,787,893
Selected Financial Data (USD $)
Free cash flow to equity (FCFE) (in millions)	2,562
FCFE per share	3.27
Current share price (P)	80.85
Ratio
P/FCFE	24.73	12.44

If company P/FCFE is lower then the P/FCFE of benchmark then company is relatively undervalued.

Otherwise, if company P/FCFE is higher then the P/FCFE of benchmark then company is relatively overvalued.

Honeywell International Inc., P/FCFE calculation

	Dec 31, 2012	Dec 31, 2011	Dec 31, 2010	Dec 31, 2009	Dec 31, 2008
No. shares of common stock outstanding¹	783,787,893	775,363,731	784,122,288	764,552,212	735,181,035
Selected Financial Data (USD $)
Free cash flow to equity (FCFE) (in millions)²	2,562	2,757	2,255	2,096	3,693
FCFE per share⁴	3.27	3.56	2.88	2.74	5.02
Share price^1, 3	70.11	60.10	57.98	37.86	33.06
P/FCFE, Comparison to Industry
Honeywell International Inc.⁵	21.45	16.90	20.16	13.81	6.58
Industry, Industrials	11.46	15.68	16.74	12.98	9.01

¹ Data adjusted for splits and stock dividends.

³ Close price on the filing date of Honeywell International Inc.'s Annual Report.

2012 Calculations

⁴ FCFE per share = FCFE ÷ No. shares of common stock outstanding
2,562,000,000 ÷ 783,787,893 = 3.27

⁵ P/FCFE = Share price ÷ FCFE per share
= 70.11 ÷ 3.27 = 21.45

Ratio	Description	The company
P/FCFE	Price to free cash flow to equity is cash valuation indicator of stockholders' equity.	Honeywell International Inc.'s P/FCFE ratio declined from 2010 to 2011 but then increased from 2011 to 2012 exceeding 2010 level.