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Honeywell's Losing Grip in Industrial Automation: What's Impeding Its Growth?

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Key Takeaways

  • Honeywell's Industrial Automation revenues fell 6.1% in the first nine months of 2025.
  • Sensing and safety and productivity solutions saw sharp declines tied to divestiture and lower payments.
  • HON expects low-single-digit 2025 declines, though aerospace and building automation remain strong.

Honeywell International Inc. (HON - Free Report) has been witnessing persistent weakness in the Industrial Automation segment. In the first nine months of 2025, revenues from the segment declined 6.1% on a year-over-year basis. Softness in sensing & safety technologies and productivity solutions and services businesses remains a major concern for the segment.

Sales from the sensing & safety technologies business declined 29.3% year over year in the same period, owing to the divestiture of the PPE business and the timing of large project execution. The productivity solutions and services unit also witnessed a 9% sales decline, largely due to a decrease in license and settlement payments.

Within the Industrial Automation segment, sales from the products group fell 10% year over year in the first nine months of the year. Softness in the industrial market due to a slowdown in the overall manufacturing sector might impede the segment’s growth in the near term. For 2025, it anticipates that the Industrial Automation segment’s organic sales will decline in the low-single digit.

Nevertheless, solid momentum in aerospace and building automation businesses augurs well for Honeywell. The Aerospace segment is particularly strong, driven by strength in commercial aviation and defense businesses and growth in air transport flight hours.

Business Performance of HON's Peers

RBC Bearings Incorporated (RBC - Free Report) is witnessing strength in the Industrial segment (revenues inched up 0.7% year over year in second-quarter fiscal 2026). Stable demand for RBC’s highly engineered bearings and precision components in metals and mining, warehousing and logistics, forest products and food and beverage markets bodes well for the segment.

Another peer, 3M Company (MMM - Free Report) , has been witnessing solid momentum in the Safety and Industrial segment, driven by strength in personal safety, industrial specialties, adhesives and tapes, and electrical markets. Stable demand for 3M’s electrical infrastructure products, like medium voltage cable accessories and insulation tapes, augurs well for the segment in the quarters ahead. Organic sales from 3M’s Safety and Industrial segment grew 3.1% year over year in the first nine months of 2025.

HON's Price Performance, Valuation and Estimates

Shares of Honeywell have lost 1.8% in the past month compared with the industry’s decline of 7.3%.

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From a valuation standpoint, HON is trading at a forward price-to-earnings ratio of 18.28X, above the industry’s average of 14.17X. Honeywell carries a Value Score of C.

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The Zacks Consensus Estimate for HON’s 2025 earnings has been on the rise 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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