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The Zacks Consensus Estimate for the company’s third-quarter earnings has been revised downward by 4.4% in the past 90 days. However, the company has an impressive earnings surprise history, having outperformed the Zacks Consensus Estimate in each of the trailing four quarters, the average beat being 1.8%.
Let’s see how things are shaping up for Honeywell this earnings season.
Honeywell International Inc. Price and EPS Surprise
Honeywell’s third-quarter performance is likely to have benefited from strong growth in commercial aviation, building products, productivity solutions and services, advanced sensing technologies, advanced materials and recurring connected software businesses.
Pricing actions and cost control measures are expected to have supported the company’s margin performance. For the third quarter, HON expects sales to increase 7-11% on an organic basis. It expects adjusted earnings of $2.10-$2.20 for the third quarter, reflecting an increase of 4-9% year over year. The Zacks Consensus Estimate for the same reflects year-over-year growth of 6.9%. We expect the company’s adjusted earnings to increase 6.2% year over year.
The Aerospace segment is expected to have benefited from a recovery in commercial flight hours. The Zacks Consensus Estimate for Aerospace segment net sales in the third quarter indicates a rise of 8.1% from the year-ago reported figure. For the third quarter, we expect Aerospace segment revenues to increase 10.4% year over year.
Commercial actions and strength in building products and solutions are likely to have driven performance of the Building Technologies segment in the third quarter. The Zacks Consensus Estimate for Building Technologies segment revenues suggests a 13.1% increase from the year-ago reported figure. We expect the same to rise 9.1% for the third quarter.
The Performance Materials and Technologies segment is expected to reflect higher revenues on the back of strength in process solutions business and advanced materials business. The Zacks Consensus Estimate for Performance Materials and Technologies segment revenues shows a 9.1% increase from the year-ago reported number. For the third quarter, we expect the same to rise 5.9% year over year.
However, performance of the Safety and Productivity Solutions segment is expected to have been affected by lower personal protective equipment and warehouse automation volume. Headwinds across Honeywell’s UOP business owing to suspended operations in Russia are also likely to have hurt the segment’s performance in the to-be-reported quarter.
Supply chain disruptions, particularly relating to availability of semiconductors, and raw material cost inflation are likely to have weighed on Honeywell’s third-quarter performance. Labor market challenges, which are limiting production capabilities, and a decline in COVID-related mask sales might have also hurt performance.
Given Honeywell’s substantial international presence, foreign currency headwinds are expected to have impacted the company’s top line in the to-be-reported quarter.
What Does the Zacks Model Say?
Our proven model does not conclusively predict an earnings beat for Honeywell this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of beating estimates, which is not the case here, as elaborated below. You can see the complete list of today’s Zacks #1 Rank stocks here.
Earnings ESP: Honeywell has an Earnings ESP of -0.12%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Honeywell currently carries a Zacks Rank #3.
Highlights of Q2 Earnings
Honeywell’s second-quarter 2022 adjusted earnings of $2.10 per share surpassed the Zacks Consensus Estimate of $2.03. The bottom line improved approximately 4% year over year. Total revenues of $8,953 million also outperformed the Zacks Consensus Estimate of $8,687.1 million. The top line increased roughly 2% from the year-ago quarter. Results benefited from growth in commercial aerospace, building products, advanced sensing technologies and advanced materials businesses.
Stocks to Consider
Here are some companies that you may want to consider as, according to our model, these have the right combination of elements to beat on earnings this reporting cycle.
Illinois Tool Works (ITW - Free Report) has an Earnings ESP of +0.38% and a Zacks Rank #3. The company is slated to release third-quarter 2022 results on Oct 25.
Illinois Tool’s earnings have surpassed the Zacks Consensus Estimate in three of the preceding four quarters, while missing in one. The average beat was 2.8%.
Emerson Electric Co. (EMR - Free Report) has an Earnings ESP of +0.81% and a Zacks Rank #3. The company is scheduled to release fourth-quarter fiscal 2022 (ended Sep 30, 2022) results on Nov 2.
Emerson’s earnings have surpassed the Zacks Consensus Estimate in each of the trailing four quarters, the average beat being 6%.
Image: Bigstock
Will Honeywell (HON) Disappoint in Q3 Earnings on Cost Woes?
Honeywell International Inc. (HON - Free Report) is scheduled to report third-quarter 2022 results on Oct 27, before market open.
The Zacks Consensus Estimate for the company’s third-quarter earnings has been revised downward by 4.4% in the past 90 days. However, the company has an impressive earnings surprise history, having outperformed the Zacks Consensus Estimate in each of the trailing four quarters, the average beat being 1.8%.
Let’s see how things are shaping up for Honeywell this earnings season.
Honeywell International Inc. Price and EPS Surprise
Honeywell International Inc. price-eps-surprise | Honeywell International Inc. Quote
Factors to Note
Honeywell’s third-quarter performance is likely to have benefited from strong growth in commercial aviation, building products, productivity solutions and services, advanced sensing technologies, advanced materials and recurring connected software businesses.
Pricing actions and cost control measures are expected to have supported the company’s margin performance. For the third quarter, HON expects sales to increase 7-11% on an organic basis. It expects adjusted earnings of $2.10-$2.20 for the third quarter, reflecting an increase of 4-9% year over year. The Zacks Consensus Estimate for the same reflects year-over-year growth of 6.9%. We expect the company’s adjusted earnings to increase 6.2% year over year.
The Aerospace segment is expected to have benefited from a recovery in commercial flight hours. The Zacks Consensus Estimate for Aerospace segment net sales in the third quarter indicates a rise of 8.1% from the year-ago reported figure. For the third quarter, we expect Aerospace segment revenues to increase 10.4% year over year.
Commercial actions and strength in building products and solutions are likely to have driven performance of the Building Technologies segment in the third quarter. The Zacks Consensus Estimate for Building Technologies segment revenues suggests a 13.1% increase from the year-ago reported figure. We expect the same to rise 9.1% for the third quarter.
The Performance Materials and Technologies segment is expected to reflect higher revenues on the back of strength in process solutions business and advanced materials business. The Zacks Consensus Estimate for Performance Materials and Technologies segment revenues shows a 9.1% increase from the year-ago reported number. For the third quarter, we expect the same to rise 5.9% year over year.
However, performance of the Safety and Productivity Solutions segment is expected to have been affected by lower personal protective equipment and warehouse automation volume. Headwinds across Honeywell’s UOP business owing to suspended operations in Russia are also likely to have hurt the segment’s performance in the to-be-reported quarter.
Supply chain disruptions, particularly relating to availability of semiconductors, and raw material cost inflation are likely to have weighed on Honeywell’s third-quarter performance. Labor market challenges, which are limiting production capabilities, and a decline in COVID-related mask sales might have also hurt performance.
Given Honeywell’s substantial international presence, foreign currency headwinds are expected to have impacted the company’s top line in the to-be-reported quarter.
What Does the Zacks Model Say?
Our proven model does not conclusively predict an earnings beat for Honeywell this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of beating estimates, which is not the case here, as elaborated below. You can see the complete list of today’s Zacks #1 Rank stocks here.
Earnings ESP: Honeywell has an Earnings ESP of -0.12%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Honeywell currently carries a Zacks Rank #3.
Highlights of Q2 Earnings
Honeywell’s second-quarter 2022 adjusted earnings of $2.10 per share surpassed the Zacks Consensus Estimate of $2.03. The bottom line improved approximately 4% year over year. Total revenues of $8,953 million also outperformed the Zacks Consensus Estimate of $8,687.1 million. The top line increased roughly 2% from the year-ago quarter. Results benefited from growth in commercial aerospace, building products, advanced sensing technologies and advanced materials businesses.
Stocks to Consider
Here are some companies that you may want to consider as, according to our model, these have the right combination of elements to beat on earnings this reporting cycle.
Illinois Tool Works (ITW - Free Report) has an Earnings ESP of +0.38% and a Zacks Rank #3. The company is slated to release third-quarter 2022 results on Oct 25.
Illinois Tool’s earnings have surpassed the Zacks Consensus Estimate in three of the preceding four quarters, while missing in one. The average beat was 2.8%.
Emerson Electric Co. (EMR - Free Report) has an Earnings ESP of +0.81% and a Zacks Rank #3. The company is scheduled to release fourth-quarter fiscal 2022 (ended Sep 30, 2022) results on Nov 2.
Emerson’s earnings have surpassed the Zacks Consensus Estimate in each of the trailing four quarters, the average beat being 6%.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.