Honeywell Aerospace Stock Tumbles as Precision-Casting Shortage Takes Toll

Honeywell Aerospace's stock price plummeted by 23.16% to $156.47 on August 6, down from its July 2 close of $247.15.

The decline is attributed to a precision-casting shortage that has forced the company to prioritize deliveries to original equipment manufacturers (OEMs) over the commercial aftermarket.

Although the aftermarket grew by 8% to $2.03 billion, the company's adjusted earnings per share (EPS) fell by 32% to $1.87 due to a margin-mix inversion, sales grew by 5%, but adjusted EBIT fell by 7%.

Honeywell Aerospace has admitted that the bottleneck is not going away and has reset its guidance to reflect the demonstrated capabilities of its suppliers, rather than relying on promised forecasts.