Honeywell Gains From Strength in Aerospace Unit: Can the Momentum Sustain?

Honeywell International Inc. HON is witnessing solid momentum in the Aerospace Technologies segment. Organic revenues from the segment increased 21% year over year in the fourth quarter of 2025, constituting more than 46% of its business. Also, in the first, second and third quarters, organic revenues from this market increased 9%, 6% and 12%, respectively.

The top-line results were driven by sustained strength in its commercial aviation aftermarket business, due to solid demand in the air transport market and supply-chain improvements. After witnessing an increase of 15%, 7% and 19% in the first, second and third quarters of 2025, respectively, organic sales from its commercial aviation aftermarket increased 13% year over year in the fourth quarter. Also, solid momentum in the commercial aviation original equipment (OEM) business due to improved production and reduced customer destocking bodes well.

Also, strength in Honeywell’s defense and space business, supported by stable U.S. and international defense spending volumes and sustained demand from the current geopolitical climate, has been driving its performance.

HON is poised to maintain strong demand momentum going forward, with both commercial and military aircraft programs expected to continue benefiting from strong air travel activities and defense budgets. For 2026, it expects organic sales in the Aerospace Technologies segment to be up in the high-single-digit range, driven by continued momentum in both commercial aviation and defense and space businesses.

HON's Peers in the Aerospace Market

Among its major peers, Howmet Aerospace Inc.’s HWM defense aerospace market is playing an important role in driving its overall growth. In the fourth quarter of 2025, Howmet’s revenues from the defense aerospace market jumped 20% year over year, which accounted for 17% of its total sales. The surge in revenues was fueled by robust demand for Howmet’s engine spares, particularly related to the F-35 program and an increase in orders for new builds and legacy fighter jet parts.

Its another peer, RTX Corporation RTX is benefiting from strength in the commercial aerospace market, with growth in both aftermarket and OEM verticals. RTX reported 12.1% sales growth in the fourth quarter, driven by solid momentum in the Collins Aerospace and Pratt & Whitney segments. Rising aircraft utilization and demand for sustainable technologies are supporting RTX Corp.’s growth.

HON's Price Performance, Valuation and Estimates

Shares of Honeywell have gained 5.7% in the past year compared with the industry’s growth of 0.3%.

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From a valuation standpoint, HON is trading at a forward price-to-earnings ratio of 21.40X, above the industry’s average of 15.42X. Honeywell carries a Value Score of D.

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The Zacks Consensus Estimate for HON’s 2026 earnings has inched up 0.6% over the past 60 days.

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Honeywell currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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