Honeywell & KE2 Therm To Cut Energy Costs For Retail Grocers

Honeywell International Inc. (NYSE:HON) recently announced a collaboration with KE2 Therm — a developer and producer of smart refrigeration controllers based in the United States.

Under the partnership, Honeywell will gain selling rights to KE2 Therm Solutions, which include advanced smart refrigeration controllers in the grocery domain. Also, the deal will allow KE2 Therm to sell Honeywell Multisite technologies comprising building controls systems, refrigerant leak detection sensors as well as electrical meters.

Notably, as a retail multi-site energy management solution, Honeywell Multisite provides full-service building management that includes engineering, design, programming as well as software and hardware production among others.

As a matter of fact, Honeywell’s leading service energy management support solutions combined with KE2 Therm’s advanced smart refrigeration controllers will help retail grocers to reduce energy costs and wastage apart from meeting regulatory instructions. The deal will also allow both the companies to serve a larger customer base that consists of retailer, grocer and restaurant chain, offering them an opportunity to realize bottom-line savings.

Our Take

Solid demand for commercial fire and security products is likely to consistently boost revenues at Honeywell’s Building Technologies segment. Also, strength in commercial aftermarket business and robust orders in the U.S. and international defense business are likely to drive the Aerospace segment’s revenues in the quarters ahead.

Furthermore, Honeywell believes that strong demand for its warehouse automation, sensing and IoT businesses will support the Safety and Productivity Solutions segment’s revenue growth.

Year to date, shares of Honeywell have gained 26.5% compared with the industry’s 20% growth.

However, softness in the company’s productivity product business due to inventory destocking, fewer large project rollouts in the mobility space and lower channel sell-through, remains a concern.

Zacks Rank & Key Picks

Honeywell currently carries a Zacks Rank #3 (Hold).

Some better-ranked stocks from the same space are Federal Signal Corporation (NYSE:FSS) , Danaher Corporation (NYSE:DHR) and United Technologies Corporation (NYSE:UTX) . While Federal Signal sports a Zacks Rank #1 (Strong Buy), Danaher and United Technologies carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Federal Signal surpassed the Zacks Consensus Estimate in each of the preceding four quarters, the average earnings beat being 16.48%.

Danaher outpaced the consensus mark in each of the preceding four quarters, the average earnings beat being 3.25%.

United Technologies outpaced the consensus estimates in each of the preceding four quarters, the average earnings beat being 13.19%.

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