HON Profit Margins
Gross, Operating & Net Margin Analysis for Honeywell International Inc
Margin Quality
Good
Current Profit Margins
Gross Margin
36.9%
$13.83B gross profit
Operating Margin
21.7%
$8.13B operating income
Net Profit Margin
12.6%
$4.73B net income
5-Year Margin Trends
What Margins Indicate About HON
Business Quality
Moderate gross margins indicate Honeywell International Inc operates in a competitive market with balanced pricing dynamics.
Operational Efficiency
Expanding operating margins show Honeywell International Inc is improving operational leverage and cost management.
Profitability
Net margins in the 5-15% range are solid and typical for many profitable businesses.
Investment Implications
Mixed margin trends require deeper analysis to understand underlying business dynamics and sustainability.
Understanding Profit Margins
Gross Margin
(Revenue - Cost of Goods Sold) / Revenue. Measures pricing power and production efficiency before operating expenses.
Operating Margin
Operating Income / Revenue. Shows profitability from core operations after all operating expenses but before interest and taxes.
Net Profit Margin
Net Income / Revenue. The bottom line - shows how much profit the company keeps from each dollar of revenue after all expenses.
Analyze HON Profitability
Get complete financial analysis with profitability trends, ROE, ROIC, and more
Frequently Asked Questions
What is HON's profit margin?
HON (Honeywell International Inc) has a net profit margin of 12.6%, meaning the company keeps $0.12630201378131511 in profit for every dollar of revenue. This represents a change from the previous year's net margin of 14.9%.
What is HON's gross margin?
HON's gross margin is 36.9%. Gross margin measures the percentage of revenue remaining after subtracting the cost of goods sold. A moderate gross margin like this reflects the competitive dynamics of the Industrials.
What is HON's operating margin?
HON has an operating margin of 21.7%. Operating margin shows profitability after operating expenses but before interest and taxes. The 21.7% year-over-year improvement suggests better operational efficiency.
Are HON's profit margins good?
HON's margins are considered good. When evaluating margins, it's important to compare against Industrial Conglomerates peers, as different sectors have structurally different margin profiles.
How do profit margins affect HON stock?
Profit margins are a key indicator of HON's business quality and competitive position. The current margins should be evaluated alongside growth rates and return on capital to assess overall business quality. Expanding margins often lead to stock price appreciation, while contracting margins can signal competitive pressures.
What drives HON's profit margins?
HON's profit margins are influenced by several factors: pricing power vs competitors, operational efficiency, scale advantages, input costs (materials, labor), Industrial Conglomerates-specific dynamics, and management execution. The significant expansion in gross margin suggests changes in these underlying drivers.
Disclaimer: Margin analysis is based on reported financial statements and should be compared to industry peers for context. Different sectors have structurally different margin profiles. This information is for educational purposes only and should not be considered financial advice.