WRAPUP 2-Asian demand boosts profit at U.S. manufacturers

* Honeywell, Ingersoll, Dover top Wall Street forecasts

* Honeywell sees growth despite ‘tempered’ economy-CEO

* Ingersoll cites Asian demand

* Honeywell, Ingersoll boost full-year profit views

* Honeywell, Dover shares little changed
(Rewrites, adds quotes from portfolio manager and CFOs of
Honeywell and Ingersoll, link to graphic)

By Scott Malone and Nick Zieminski

BOSTON/NEW YORK, Oct 22 (BestGrowthStock) – Diversified U.S.
manufacturers Honeywell International Inc (HON.N: ) and
Ingersoll-Rand Plc (IR.N: ) beat Wall Street’s profit
expectations and raised their forecasts for the rest of the
year as strong demand from Asia helped to offset a tepid
recovery at home.

Emerging-market growth, particularly in China and India,
will remain a major driver for the sector as it heads into
2011, according to Honeywell, the world’s largest maker of
cockpit electronics, which said it expects sales to grow by 5
percent or more next year.

“It’s pretty muted growth in the developed economies of the
U.S. and Europe and continued pretty robust growth in the
emerging markets, notably Eastern Europe and China, India,
Brazil and Latin America,” Chief Financial Officer Dave
Anderson said in an interview. “We’re looking at pretty low
numbers for the U.S. and Europe.” [ID:nN22171838]

Honeywell and Ingersoll reported strong demand from Asia
for equipment that is used to heat, cool and secure large
buildings. That helped to offset a continued slump in
nonresidential construction in their home markets.

“For the balance of 2010 we expect markets in Europe and
the Middle East to decline slightly and growth in Asia to
continue to be led by strong growth in China,” Ingersoll CFO
Steve Shawley said on a conference call.

Investors are looking to industrials to boost their
presence in the region, particularly by selling more into the
fast-growing Chinese construction sector. Honeywell generates
about 40 percent of its revenue from equipment used in large
buildings and 32 percent from the aviation sector.

China surprised investors on Tuesday by raising interest
rates for the first time in nearly three years, in a bid to
slow the rise in asset prices.

“If there’s one thing that’s working for anybody today,
it’s growth in the Asia-Pacific region,” said Barbara Marcin,
portfolio manager of the Gabelli Blue Chip Value Fund, which
holds Honeywell shares. “Everyone would like to see Honeywell a
little more exposed there.”

Honeywell said sales to the Asia-Pacific region were up 21
percent in the quarter, more than twice the company’s overall
growth rate.

For a related graphic click: http://r.reuters.com/nas79p

PENSION WORRIES

Morris Township, New Jersey-based Honeywell reported an 18
percent drop in net income, which it attributed to its
aggressive approach to pension accounting. [ID:nN22129395]

Earnings per share came in at 64 cents, ahead of the 62
cents analysts had estimated, according to Thomson Reuters
I/B/E/S.

Honeywell forecast full-year earnings of $2.52 per share,
above its most recent outlook of $2.40 to $2.50. It was the
third time this year that the company had raised this target.

It said that pension costs will continue to weigh on
earnings next year, representing a drag of $350 million to $400
million on net profit. [ID:nN22165126]

Honeywell shares were down 1 cent to $46.66 on the New York
Stock Exchange.

Ingersoll’s net income rose 7 percent, with earnings of 80
cents per share from continuing operations, 1 cent ahead of the
analysts’ average estimate. [ID:nN22106994]

The company said it now expected full-year profit of $2.30
to $2.40 per share, excluding 12 cents in charges for
healthcare tax expenses.

That is higher than its most recent forecast of $2.18 to
$2.38 per share.

Ingersoll shares rose 8 cents to $39.04.

Smaller industrial Dover Corp (DOV.N: ), which makes
supermarket equipment, industrial pumps and valves, said profit
more than doubled. [ID:nN22158512]

Dover earned 98 cents a share from continuing operations,
excluding a tax benefit and other items. Analysts on average
expected 90 cents.

However, Dover did not beat forecasts by as wide a margin
as in the past several quarters and Dover shares fell 4 percent
to $52.61.

Investors had been sensitive to any sign of weakness in
industrial earnings reports this quarter. On Wednesday they bid
shares of Caterpillar Inc (CAT.N: ) down 1 percent, even after
the world’s largest maker of earth-moving equipment easily
topped profit forecasts, amid concerns that its recent pace of
profit margin improvement was not sustainable.
(Reporting by Scott Malone and Nick Zieminski; Editing by Lisa
Von Ahn and Steve Orlofsky)

WRAPUP 2-Asian demand boosts profit at U.S. manufacturers