Honeywell International Inc. (HON), while reporting higher third-quarter results above market estimates, on Thursday raised fiscal 2025 adjusted earnings and organic sales growth outlook, including the impact of spinning off its advanced materials business. Adjusted earnings for the year are expected above market estimates.
In pre-market activity on the Nasdaq, Honeywell shares were gaining around 4.6 percent to trade at $216.02.
For the year, the company now expects adjusted earnings per share in the range of $10.60 to $10.70, up 10 cents at the midpoint from the prior guidance range. The company previously expected $10.45 to $10.65 per share.
Full-year sales are now expected to be $40.7 billion to $40.9 billion with organic sales growth of approximately 6 percent. The previous outlook was $40.8 billion to $41.3 billion, with organic sales growth of approximately 4 percent to 5 percent.
Analysts on average expect the company to earn $10.54 per share on sales of $40.88 billion. Analysts' estimates typically exclude special items.
The guidance now includes the impact of the Solstice Advanced Materials spin-off, set for completion on October 30, which is expected to reduce full-year sales compared to the prior year by $0.7 billion, and adjusted earnings per share by $0.21.
Segment margin is expected to be in the range of 22.9 percent to 23.0 percent, with segment margin expansion of 30 to 40 basis points year over year, while the previous outlook was 23.0 percent - 23.2 percent.
Excluding the impact of the Bombardier agreement signed in the fourth quarter of 2024, the company expects organic sales growth of approximately 5 percent, segment margin down 40 to 30 basis points year over year, and adjusted earnings per share up approximately 3 percent year over year.
The company expects adjusted earnings per share growth of 5 percent to 6 percent when excluding both the impact of the Bombardier agreement and the October spin-off of Solstice Advanced Materials.
In the third quarter, Honeywell's bottom line came in at $1.825 billion or $2.86 per share, higher than $1.413 billion or $2.16 per share last year.
Adjusted earnings were $2.82 per share for the period, compared to $2.58 per share a year earlier.
Analysts had expected the company to earn $2.57 per share.
The company's sales for the period rose 7 percent to $10.408 billion from $9.728 billion last year. The Street was looking for sales of $10.16 billion for the quarter.
The company reported organic sales growth of 6 percent, led by double-digit organic sales growth in commercial aftermarket and defense and space.
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