Honeywell International Inc. (NASDAQ:HON)

The annual financial data reveals several key trends in the company's asset management over the five-year period from 2020 to 2024.

Current Assets

The current assets demonstrate a declining trend from 28,175 million US dollars in 2020 to a low of 23,502 million in 2023, representing a steady decrease over four years. However, in 2024, the current assets rebounded significantly, increasing to 27,908 million US dollars, which nears the figure seen in 2020. This suggests a pattern of contraction in the early years with a recovery in the most recent period.

Adjusted Current Assets

Adjusted current assets follow a similar trend to the primary current assets, starting at 28,377 million US dollars in 2020 and declining yearly to 23,825 million in 2023. In 2024, adjusted current assets also increased markedly to 28,222 million US dollars. The adjusted figures consistently remain slightly higher than the unadjusted current assets, indicating some adjustments that marginally increase asset valuations.

Overall, both sets of assets indicate a downward movement during the first four years followed by a notable recovery in the latest year. This pattern may reflect changes in working capital management, liquidity adjustments, or varying operational conditions impacting asset levels. The recovery in 2024 could signal improved asset acquisition, inventory management, or receivables collection, contributing to enhanced liquidity at year-end.

Total Assets

The total assets show a slight decline from 64,586 million US dollars at the end of 2020 to 61,525 million US dollars by the end of 2023. This indicates a gradual reduction in total asset base over the four-year period. However, there is a notable increase in total assets in 2024, reaching 75,196 million US dollars, which suggests significant asset growth or acquisition activity during that year.

Adjusted Total Assets

The adjusted total assets display a very similar trend to total assets, moving from 64,028 million US dollars in 2020 to 61,456 million US dollars in 2023, reflecting a consistent decrease over this period. In 2024, adjusted total assets sharply increase to 75,272 million US dollars, mirroring the rise observed in total assets and reaffirming the substantial expansion in the asset base during that year.

Overall Analysis

Both total and adjusted total assets presented a slight downward trend from 2020 to 2023, suggesting a phase of either asset reduction or slower growth. The significant jump in 2024 for both metrics indicates a strategic change leading to asset accumulation, which may be the result of investments, acquisitions, or revaluation of assets.

The analysis of the data reveals fluctuations in both current liabilities and adjusted current liabilities over the five-year period. Current liabilities exhibit a general upward trend, starting at 19,197 million US dollars at the end of 2020 and reaching a peak of 21,256 million US dollars by the end of 2024. Despite this overall increase, there is a notable dip in 2023 to 18,539 million US dollars, suggesting a temporary reduction in short-term obligations during that year.

Adjusted current liabilities follow a similar trend but remain consistently lower than the unadjusted current liabilities, indicating adjustments that reduce the liabilities figure, possibly through exclusion of certain items such as deferred revenue or other non-cash liabilities. The adjusted liabilities start at 15,481 million US dollars in 2020, increase steadily through 2022, and then drop significantly in 2023 to 14,579 million US dollars, before rising again to 17,363 million US dollars in 2024.

Current Liabilities Trend

Increase of approximately 10.8% over the five-year period.

Notable dip in 2023, representing a reduction of about 7% from the previous year.

Adjusted Current Liabilities Trend

Moderate increase overall, with a decrease in 2023 mirroring the pattern seen in current liabilities.

The gap between current and adjusted liabilities reflects consistent adjustments reducing the reported current liabilities by roughly 20-25% annually.

Insight

The temporary decrease in liabilities in 2023 could indicate strategic liability management, potentially aimed at improving liquidity or managing working capital.

The rebound in 2024 may suggest the resumption of normal operating levels or increased short-term obligations.

Total Liabilities

The total liabilities exhibit a generally stable pattern from 2020 to 2023, showing a slight decline from 46,789 million USD to 45,084 million USD. However, there is a notable increase in 2024, where total liabilities rise sharply to 56,035 million USD. This indicates a significant increase in the company's obligations or debt level in the most recent year, suggesting potential changes in financing strategies or business expansion activities.

Adjusted Total Liabilities

Adjusted total liabilities follow a similar trend as the total liabilities but at lower absolute values, implying some adjustments for certain liabilities over the periods. From 2020 to 2023, adjusted liabilities show a gradual decline from 39,544 million USD to 37,822 million USD, reflecting possibly improved liability management or reclassification effects. In 2024, adjusted liabilities also increase substantially to 49,130 million USD, consistent with the rise observed in total liabilities, reinforcing the indication of an overall increase in debt or obligations in the latest year.

Overall Analysis

Both total and adjusted liabilities remained relatively stable or slightly decreased from 2020 through 2023, suggesting controlled liability management during this period. The sharp escalation in both metrics in 2024 could point towards considerable new borrowing, increased operational liabilities, or strategic financial decisions that increased the company's leverage. This trend warrants further examination of the underlying causes, such as capital expenditures, acquisitions, or changes in debt structure, to assess the potential impact on the company’s financial stability and risk profile.

The data reveals notable fluctuations in the equity figures over the five-year period, from 2020 through 2024. Two measures of equity are presented: total Honeywell shareowners’ equity and adjusted total shareowners’ equity, both expressed in millions of US dollars.

Total Honeywell shareowners’ equity

This measure shows an initial increase from 17,549 million in 2020 to 18,569 million in 2021, representing a moderate growth. However, a subsequent decline is observed in the following years, with equity decreasing to 16,697 million in 2022 and further to 15,856 million in 2023. By 2024, the equity rebounds to 18,619 million, surpassing the 2020 level and slightly exceeding the 2021 peak. This pattern suggests volatility with a dip in the mid-period followed by recovery.

Adjusted total shareowners’ equity

This adjusted measure follows a similar trend but with generally higher values compared to the unadjusted figure. It increased from 24,484 million in 2020 to 26,421 million in 2021, then declined to 24,735 million in 2022 and continued to drop to 23,634 million in 2023. In 2024, a recovery occurs with the figure rising to 26,142 million, nearing the high point seen in 2021. The adjustment appears to reflect additional components influencing equity, and the trend follows the same pattern of initial growth, mid-term decline, and eventual recovery.

Overall, both total and adjusted shareowners’ equity exhibit a cyclical trend characterized by growth during the early years, a reduction in the middle of the five-year span, and a strong rebound in the latest year. This suggests that the company experienced some challenges or changes affecting equity between 2021 and 2023, followed by a phase of recovery or improvement by 2024. The consistent relationship between adjusted and unadjusted equity indicates that the adjustments applied maintain proportionality over time.

Total reported debt

The total reported debt showed a declining trend from 22,384 million USD in 2020 to 19,570 million USD in 2022, indicating a reduction in debt levels during the first three years. However, this was followed by a slight increase to 20,443 million USD in 2023 and then a significant rise to 31,099 million USD in 2024, suggesting an aggressive debt accumulation in the most recent year.

Total Honeywell shareowners’ equity

Shareowners’ equity increased initially from 17,549 million USD in 2020 to a peak of 18,569 million USD in 2021. Subsequently, it declined in the following two years, reaching a low of 15,856 million USD in 2023. A recovery is observed in 2024 with equity rising again to 18,619 million USD, returning close to the earlier peak levels.

Total reported capital

Total reported capital, defined as the sum of debt and equity, decreased steadily from 39,933 million USD in 2020 to 36,267 million USD in 2022. It stabilized around 36,299 million USD in 2023 but then experienced a substantial increase to 49,718 million USD in 2024, driven primarily by the spike in debt observed during the same period.

Adjusted total debt

The adjusted total debt followed a similar pattern to the total reported debt, starting at 23,212 million USD in 2020 and decreasing to 20,537 million USD in 2022. It then increased modestly to 21,536 million USD in 2023 before sharply rising to 32,225 million USD in 2024, highlighting increased leverage or financing efforts in recent times.

Adjusted total shareowners’ equity

Adjusted equity grew from 24,484 million USD in 2020 to a high of 26,421 million USD in 2021, then declined over the next two years, bottoming at 23,634 million USD in 2023. There was a partial rebound in 2024, with equity reaching 26,142 million USD, indicating some recovery but remaining below the 2021 peak.

Adjusted total capital

Adjusted total capital showed a gradual decrease from 47,696 million USD in 2020 to 45,272 million USD in 2022, remaining relatively flat at 45,170 million USD in 2023. In 2024, a notable increase to 58,367 million USD occurred, primarily driven by the rise in adjusted debt levels. This suggests an increase in total capital employed, accompanied by a shift towards greater debt financing.

The data reveals a consistent upward trend in both net sales and adjusted net sales over the five-year period. Net sales increased steadily from 32,637 million US dollars in 2020 to 38,498 million US dollars in 2024. This represents a cumulative growth of approximately 18% over the five years.

Similarly, adjusted net sales followed a comparable trajectory, rising from 33,125 million US dollars in 2020 to 38,524 million US dollars in 2024. The adjusted figures are consistently slightly higher than the reported net sales, reflecting adjustments that may account for non-recurring items or other factors to present a clearer operational sales figure.

Year-over-year increases are evident each period, although the rate of growth appears to moderate slightly between 2022 and 2023 for both net sales and adjusted net sales. Nonetheless, the overall pattern indicates stable growth without significant volatility or downturns during the period analyzed.

The financial performance over the presented years exhibits fluctuations in net income attributable to the company as well as in the adjusted net income figures.

Net Income Attributable to Honeywell

This metric demonstrates an overall increasing trend from 2020 through 2024, starting at 4,779 million USD in 2020 and rising to 5,705 million USD in 2024. A notable dip occurred in 2022 to 4,966 million USD following an increase in 2021 to 5,542 million USD. Subsequently, the net income recovered and peaked in 2023 at 5,658 million USD before a slight increase in 2024. The fluctuations suggest some volatility but overall growth in profitability.

Adjusted Net Income

Adjusted net income, which typically accounts for one-time or non-recurring items, shows more variability over the same period. It increased significantly from 4,984 million USD in 2020 to a peak of 6,230 million USD in 2021. However, there was a sharp decline in 2022 to 4,610 million USD, followed by a modest recovery in 2023 to 4,909 million USD and a strong rebound in 2024 reaching 6,034 million USD. This pattern indicates that adjusted earnings have experienced more pronounced fluctuations than reported net income, possibly reflecting the impact of exceptional items or changes in adjustments.

Overall, both net income and adjusted net income show resilience and growth prospects, although the adjusted figures point to more significant year-to-year variability, suggesting careful scrutiny of underlying adjustments is advisable when assessing earnings quality.