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Investing.com - Jefferies reiterated a Hold rating on Honeywell International (NASDAQ:HON) stock with a $245.00 price target ahead of the company’s first-quarter earnings report. The target suggests modest upside from the current price of $234.93, though InvestingPro analysis indicates the stock appears overvalued at current levels, placing it among stocks on the Most Overvalued list.
The firm expects Honeywell to report first-quarter adjusted earnings per share of $2.31 when results are released on April 23. The estimate falls within the company’s guidance range of $2.25 to $2.35 and compares to consensus expectations of $2.32. Notably, 4 analysts have revised their earnings downwards for the upcoming period, according to InvestingPro Tips.
Jefferies reduced its aerospace organic growth estimate to 6% from 7% for the quarter, citing supply chain headwinds. The revised forecast falls below the consensus estimate of 9% growth for the segment.
The firm projects first-quarter margins of 22.5%, up 10 basis points year-over-year and within the company’s guidance range of 22.4% to 22.6%. Aerospace margins are expected to decline 30 basis points to 26% due to lower volumes and a higher commercial original equipment mix.
Jefferies expects Honeywell to maintain its full-year 2026 guidance despite the slower start to the year. The firm estimates full-year organic growth of 7% in the high single digits, led by the Defense & Space segment.
In other recent news, Innovative Aerosystems announced two significant agreements with Honeywell International. The first involves acquiring an exclusive perpetual license for power generator systems used in various aircraft, including the Boeing 767 and the F-15 fighter platform. This transaction includes operational assets such as specialized tooling and testing equipment. In a separate agreement, Innovative Aerosystems entered into an asset purchase and perpetual license agreement with Honeywell for certain aftermarket parts and intellectual property related to legacy avionics product lines. This deal provides Innovative Aerosystems with production and repair capabilities for navigation and communication radios, autopilot systems, and other avionics technologies.
Meanwhile, Honeywell has been active on multiple fronts. The company signed a supplier framework agreement with the U.S. Department of War, committing to a $500 million multi-year investment to expand defense production. This agreement aims to increase the production of navigation systems, actuators, and electronic warfare solutions. Additionally, Honeywell announced a collaboration with Rhombus to enhance its cloud-connected security portfolio with AI-powered video management solutions. This partnership will integrate access control and video management into a single cloud platform, expanding Honeywell’s offerings in the security sector.
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