Honeywell Aerospace (HONA) Stock Tanks After Slashing Guidance in First Standalone Earnings

TLDR

• HONA stock fell as much as 17% in premarket trading after its first quarterly report as a standalone company
• Q2 sales came in at $4.52 billion, up 5% year over year, missing the $4.6 billion Wall Street estimate
• Adjusted EPS fell 32% to $1.87, well below analyst expectations of $8.86 for the full year
• 2026 organic sales growth guidance cut to 4%-5%, down from a prior forecast of 7%-9%
• Supply chain issues are forcing the company to prioritize Boeing and Airbus deliveries over its higher-margin aftermarket business

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Honeywell Aerospace (HONA) stock dropped as much as 17% before the bell on Thursday after the company posted its first quarterly results since spinning off from Honeywell Technologies (HON) in June. The stock was trading around $177 in premarket, down roughly 13% at that point.

Honeywell Aerospace Inc, HONA

The numbers missed across the board. Q2 sales came in at $4.52 billion, up 5% year over year but short of the $4.6 billion Wall Street expected. Operating profit hit $1 billion, down 7% from a year ago, against expectations of $1.1 billion. Inventory obsolescence charges were part of the drag.

Adjusted EPS fell 32% year over year to $1.87, missing estimates.

HONEYWELL AEROSPACE $HONA Q2’26 EARNINGS HIGHLIGHTS

🔹 Revenue: $4.5B (Est. $4.61B) 🔴; +5% YoY
🔹 Adj. EPS: $1.87 (Est. $2.11) 🔴; -32% YoY
🔹 Adjusted EBIT: $1.0B; -7% YoY
🔹 Backlog: $18.2B; +9% YoY

FY26 Guide:
🔹 Organic Growth: 4%-5%; from 7%-9%
🔹 Adjusted EBIT:… pic.twitter.com/Z2JqETIh5s

— Wall St Engine (@wallstengine) August 5, 2026

The bigger shock was guidance. Honeywell Aerospace cut its 2026 organic sales growth forecast to 4%-5%, down from a previous range of 7%-9%. Full-year operating profit is now expected at around $4.4 billion, below the prior $4.7 billion forecast and short of the $4.6 billion analysts had modeled.

Full-year adjusted EPS is guided at $7.60 to $7.90, well below the $8.86 analyst consensus.

CFO Josh Jepsen told Reuters the cuts were a direct result of what the company is seeing in its supply chain. “It’s really resetting the forecast based on what we’re seeing coming through the supply chain,” he said.

Supply Chain Continues to Drag

The supply crunch is forcing Honeywell Aerospace to prioritize deliveries to Boeing and Airbus, which is eating into its higher-margin aftermarket business. That tradeoff is showing up clearly in the numbers.

Melius Research analyst Scott Mikus pointed out that Honeywell Aerospace posted 8% growth in commercial aftermarket sales last quarter. Peers reported 23%. That gap is hard to ignore.

Mikus also flagged that the company’s overdue backlog, which sits above $2 billion, is still growing. He warned that airlines have increasingly turned to repairs and PMA parts to cut maintenance costs, and if Honeywell Aerospace can’t fix its delivery problems, it risks losing future high-margin aftermarket revenue.

“The acute supply chain issue from last quarter did not improve as much as management had hoped,” Mikus wrote.

Valuation Gap vs. Peers

Honeywell Aerospace currently trades at around 23 times expected 2026 earnings. GE Aerospace trades at 48 times, and GE just raised its full-year guidance after growing Q2 operating profit 18% year over year.

Vertical Research Partners analyst Rob Stallard said the valuation looks cheap but may be a trap. He noted the company has less exposure to high-growth aerospace sub-sectors like large commercial engines or missiles compared to peers.

“While it is good that Honeywell Aerospace recognizes that it has problems, fixing them will not be an overnight affair,” Stallard wrote.

Coming into Thursday, HONA was already down about 8% since its June spinoff debut, making the post-earnings drop all the more painful for early investors.