Diversified U.S. manufacturer Honeywell International Inc raised its 2011 profit forecast on Friday and said it would sell a unit that makes antifreeze and other car care products for $950 million.
The world's largest maker of cockpit electronics said it would sell its automotive consumer products group to New Zealand-based Rank Group, owned by the billionaire Graeme Hart.
Honeywell said sales in the fourth quarter were up across all four of its divisions. The company also makes systems to control large buildings, specialty chemicals and vehicle turbochargers -- a piece of the auto business that it is keeping.
Honeywell raised its 2011 profit forecast by 10 cents to a range of $3.60 to $3.80 per share. Analysts on average look for $3.77, according to Thomson Reuters I/B/E/S.
For us to be taking up guidance at this point in the year is generally unusual, Chief Executive Officer David Cote told analysts on a conference call.
The company set its initial 2011 profit target last month.
'HEADED IN THE RIGHT DIRECTION'
Honeywell said it expected a first-quarter profit of 76 to 80 cents per share.
Everything is headed in the right direction, and that bodes well for 2011 and beyond, said Matt Collins, industrial analyst at Edward Jones in St. Louis.
A stream of better-than-expected earnings reports from big manufacturers including General Electric Co, United Technologies Corp and Caterpillar Inc over the past week have ratcheted up investors' expectations for the sector.
Fellow manufacturer Dover Corp on Friday reported better-than-expected profit, citing strong demand from the electronics and energy markets. Its shares were up almost 6 percent at $62.83.
Analysts had long called on Honeywell to sell off the consumer products unit -- reasoning that supplies consumers use to fix their cars have little connection to a large industrial conglomerate that primarily sells into the aviation and commercial construction markets.
Honeywell's other consumer products include thermostats, fans and humidifiers sold under its own name.
Honeywell shares, which flittered between modest gains and losses through the morning, were down 18 cents at $55.74 in late morning on the New York Stock Exchange.
Over the past year, the stock has risen almost 40 percent, outpacing the 29 percent rise in the Standard & Poor's capital goods industry index.
QUARTER MEETS STREET VIEW
Honeywell posted fourth-quarter earnings of $369 million, or 47 cents per share, up from $150 million, or 20 cents per share, a year earlier.
Excluding pension-related charges, the company earned 87 cents per share, meeting Wall Street's expectations.
Revenue rose 12 percent to $9.04 billion, topping the analysts' forecast of $8.84 billion.
The Morris Township, New Jersey-based company said in November that it would change its pension accounting approach to match more closely that of its peers. The shift to mark-to-market accounting means it will book gains and losses in the portfolio as they occur, rather than smoothing them over a three-year period.
(Reporting by Scott Malone; Editing by Lisa Von Ahn and Matthew Lewis)