Honeywell Stock Slides After Hours On Updated 2024 Outlook

Honeywell International Inc (NASDAQ:HON) shares are trading lower in Monday’s after-hours session after the company announced a strategic agreement with Bombardier and cut its near-term 2024 outlook.

What Happened: Honeywell announced the signing of an agreement with jet manufacturer Bombardier to provide advanced technology to current and future Bombardier aircraft.

Under the partnership, the companies will collaborate on the development of Honeywell avionics and work to certify and offer JetWave X for both new production and aftermarket installations. Bombardier will also have access to Honeywell’s full suite of L-Band satellite communications products and antennas.

Honeywell noted that all legacy pending litigation between the two companies has been resolved. The company estimated that the value of the partnership will be around $17 billion over its lifetime.

“This is a tremendous opportunity to co-innovate and advance next-generation technologies, including Anthem avionics and engines,” said Vimal Kapur, chairman and CEO of Honeywell.

“Growing our long-term collaborative relationship with Bombardier is directly connected to Honeywell’s focus on compelling megatrends — automation, the future of aviation, and energy transition.” 

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As a result of the strategic agreement, Honeywell expects its near-term financials to be negatively impacted. Fourth-quarter revenue is now expected to be approximately $400 million lower than previous guidance, while earnings are expected to be about 47 cents per share lower than previous guidance.

Honeywell lowered its full-year 2024 revenue guidance from a range of $38.6 billion to $38.8 billion to a new range of $38.2 billion to $38.4 billion, versus estimates of $38.69 billion. Honeywell also lowered its full-year earnings outlook from a range of $10.15 to $10.25 per share to a new range of $9.68 to $9.78 per share, versus estimates of $10.19 per share.

Honeywell now anticipates a full-year operating cash flow of $5.8 billion to $6.1 billion and a full-year free cash flow of $4.6 billion to $4.9 billion.

HON Price Action: Honeywell shares were down 2.93% at $223.21 after-hours at publication Monday, per Benzinga Pro.

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