Home / Business and Economy / Honeywell Aerospace Stock Plummets After Weak Results
Honeywell Aerospace Stock Plummets After Weak Results
6 Aug
Summary
- Honeywell Aerospace shares fell 11% on weak quarterly results.
- Supply chain issues are preventing output and order fulfillment.
- Company cut full-year guidance, impacting investor confidence.
Honeywell Aerospace's stock plunged 11% following a report of weak quarterly financial results and a reduced full-year forecast. These setbacks are attributed to ongoing supply chain challenges that are impacting production and the ability to fulfill orders.
Despite strong demand, evidenced by order growth, the company's second-quarter revenue of $4.52 billion and adjusted earnings per share of $1.87 missed estimates. Management acknowledged underestimating the time needed to resolve supply chain issues.
The company has revised its organic sales growth forecast to 4%-5% and expects adjusted EBIT between $4.35 billion and $4.45 billion. This revised outlook, along with a new standalone EPS guidance of $7.60-$7.90, reflects challenges in meeting previous expectations.
Management is implementing corrective measures and investing to address the supply chain bottlenecks, noting that only a small percentage of its over 3,000 suppliers are causing issues. However, these efforts and the overall execution have damaged investor confidence, with the stock facing a prolonged period of scrutiny.
