Industrial Automation Giants HON and EMR Poised for Growth Amid Market Turbulence
Honeywell Technologies (HON) and Emerson Electric (EMR) are two prominent players in the industrial automation market, both benefiting from growing investments in smart manufacturing, digital transformation, and process automation.
HON has been gaining strength in its Industrial Automation, Building Automation, and Energy & Sustainability Solutions businesses, while EMR continues to benefit from portfolio optimization and growing demand across process and discrete automation markets.
The case for HON is weakened by the segment's organic revenues decline of 1% year over year in the second quarter of 2026 due to lower customer demand in the Middle East amid ongoing geopolitical tensions. However, rising demand for liquefied natural gas (LNG) and increased automation projects are expected to support growth.
HON has also been dealing with high costs and expenses related to direct and indirect material costs, labor costs, investment in digital infrastructure, and business integration activities, resulting in a 190 basis point decline in its operating margin to 17.9%.