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Honeywell International (NYSE:HON) is the world leader in avionics systems for commercial aircraft. In addition, Honeywell makes small engines for regional and business jets as well as for military vehicles. Investors may be more familiar with Honeywell products that involve heating, cooling, ventilation, home comfort, and security. Below is a breakdown of Honeywell's revenue percentages by segment.

Honeywell's defense business has spooked investors, but the commercial aircraft market has been turning around. Increasing flight hours will continue to be a key driver for Honeywell's earnings. Honeywell has a long-term growth plan, and has set revenue and earnings expectations through 2014. The company aims to achieve a long-term revenue CAGR of 6% - 8%. Honeywell has stated that it is on target to meet the long-term objectives it has set out to achieve.

Source: 2012 Outlook Announcement Presentation 12-15-11

Investors should take notice of Honeywell's long-term perspective. It isn't often that a company has the confidence to publish such goals, especially in this economic environment. Certainly there are risks to the projections, such as a deeper or more protracted recession in Europe, but the company feels that it can manage through the tough macro environment. I encourage readers to take a look at Honeywell's investor presentations, particularly the 2012 Outlook Announcement Presentation, for details on Honeywell's long-term growth plans.

Currently shares of Honeywell trade around the mid-point of their 52 week range. Shares do trade at a premium relative to other companies in the defense sector. The premium doesn't seem absurd given that Honeywell has several other segments, including a large commercial avionics business, that drive revenue. The stock currently trades at about 15 times earnings and 12 times forward earnings. Honeywell has a price-to-earnings growth (PEG) ratio of 0.85. Honeywell has grown earnings at an annualized rate of 7% over the last five years.

The stock currently yields 2.8%. Honeywell returns about 34% of cash to shareholders through its dividend. As revenue and cash flow increase over the coming years, so too should the dividend. Honeywell has increased its dividend at an annualized rate of 8% over the last five years.

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Sterne, Agee & Leach upgraded shares of Honeywell on November 28th, citing in part the recovering commercial aircraft segment and Honeywell's long-term growth plan. Sterne, Agee & Leach expect that Honeywell can earn $6.30 per share in 2014. At 11 times 2014 earnings, they give Honeywell a price target of $69.00. An earnings multiple of 11 would be less than where Honeywell is currently trading, so there may be much more upside potential for the stock by that time.

Honeywell is a solid company with a long-term plan. It is refreshing to see management with such a long-term perspective. The stock is fairly priced right now, but investors may want to consider buying on dips. In order to get a 3% dividend yield, investors would want the stock to trade down to about $50.00. It isn't a stretch to think the stock could trade at that level given the current market volatility. Shares of Honeywell would be very attractive at a 3% or higher dividend yield. Patient investors may see Honeywell shares take flight well before the company achieves its long-term targets.

Source: Honeywell International: This Dividend Stock Could Fly High For Patient Investors