Tracing the Growth: A Comprehensive Look into Allied Signal’s Stock History
Introduction
Allied Signal, which later became Honeywell International Inc. after a merger in 1999, has witnessed an incredible journey in the world of stocks, markets, and the turbulent world of business. It has experienced ups and downs, mergers, acquisitions, breakups, and historical milestones. In this comprehensive piece, we’ll take an in-depth look into Allied Signal’s stock history, exploring the growth and development of a company that played a key role in shaping the modern industrial landscape.
The Early Years: 1920 to 1960
Foundation and Formation
Allied Chemical & Dye Corporation, the initial name of the company, was founded in 1920 by Eugene Meyer, the father of the famous Washington Post publisher Katherine Graham. The company was formed through the merger of five major industrial dye and chemical manufacturing firms. In 1928, the corporation changed its name to Allied Chemical Corporation to reflect its diversification into the production of chemicals for various industries.
First Steps in the Stock Market
Allied Chemical Corporation underwent its initial public offering (IPO) and started trading on the New York Stock Exchange (NYSE) on November 16, 1920, at $11 per share. The company soon became one of the largest chemical producers in the United States, which helped its stock perform well throughout the 1920s and 1930s. Despite the turbulences in the market due to the Great Depression of 1929, Allied Chemical sustained and recovered within the subsequent years.
Evolution and Consolidation: 1960 to 1990
Growth and Expansion
In the 1960s and 1970s, Allied Chemical started expanding its product portfolio beyond chemicals and ventured into various industries such as aerospace, automotive, and engineering. The corporation diversified both organically and through acquisitions, absorbing new businesses and boosting its resources. Some of the vital acquisitions were the Eltra Corporation in 1979, the aerospace and automotive products manufacturer Bendix Corporation in 1983, and the Fasco Motors Group in 1987.
Stock Market Performance
Thanks to the continuous expansion and acquisitions, the company’s stock price continued to climb. By 1971, the stock price reached $100 for the first time. The next big move came in 1985 when the stock price was adjusted to $50 due to a two-for-one stock split to make the stock more appealing to individual investors. The stock price continued to gain momentum throughout the 1980s, surpassing the $100 mark again by the end of the decade.
Rename and Restructure
In 1985, the corporation changed its name to AlliedSignal Inc., combining its previous name with the acquired Bendix Corporation. This new name aimed to represent the company’s dedication to both chemical and non-chemical industries, paving the way for future growth and development. By the end of the 1990s, in addition to its chemical ventures, AlliedSignal was producing products for industries such as aerospace, automotive, and engineering materials, as well as process controls and systems.
The Big Merger and Beyond: 1999 to Present
The Marriage of Two Giants
In 1999, AlliedSignal initiated a $13.8 billion merger deal with Honeywell Inc., a leading control systems and automation company. This merger brought forth a new multinational conglomerate named Honeywell International Inc. The new company kept the ticker symbol ‘HON’ previously used by Honeywell Inc. on the stock exchange. The merger was expected to result in cost savings and expanded business opportunities for the newly formed corporation.
Post-Merger Strategies and Development
Following the merger, Honeywell International implemented a strategic plan to fill gaps in its portfolio through acquisitions and divestiture of underperforming businesses. The company further diversified with acquisitions in fields such as energy efficiency, safety products, and building controls. These transactions included purchasing Sperian Protection in 2010, Intelligrated in 2016, and Elster Group in 2015, additionally divesting its automotive turbocharger business and transportation systems division in 2018.
Stock Market Success
Since the merger, Honeywell International’s stocks have consistently outperformed the Standard & Poor’s 500 Index (S&P 500). For instance, in the 20 years between 2000 and 2019, Honeywell’s stock price increased by more than 650%. Notably, the stock price breached the $150 mark for the first time in August 2017, and soon after, in January 2018, it surpassed $160 per share. The company has enjoyed consistent dividend payments and stock splits, which continue to attract investors.
Conclusion
Tracing the growth of Allied Signal’s stock history offers insight into the company’s remarkable journey in terms of development, expansion, and evolution. From its early beginnings as Allied Chemical & Dye Corporation, to its numerous acquisitions and diversifications, and, ultimately, to its massive merger with Honeywell International Inc., the company’s stock performance has consistently made waves in the market. This historical overview serves as a testament to the strength and adaptability of the company, as well as the lasting impact of strategic investments on shaping the industrial conglomerate we know today.
