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Ireland-based Eaton Corporation plc (ETN) is a diversified power management company and a global technology leader in electrical components and systems. With a market cap of $119.8 billion, Eaton operates Electrical Americas, Electrical Global, Aerospace, Vehicle, and eMobility segments.
The power management giant has substantially outperformed the broader market over the past year. Over the past 52 weeks, ETN gained 37%, outpacing the S&P 500 Index’s ($SPX) 27% returns. In 2024, ETN is up 23.6% compared to SPX’s 16.8% gains on a YTD basis.
Narrowing the focus, ETN also outperformed the S&P 500 Industrial Sector SPDR’s (XLI) 20.9% returns over the past 52 weeks and 12.3% gains on a YTD basis.
Eaton's story this year is one of power and precision. Riding the wave of surging demand for power management components in data centers, aircraft, and electric vehicles, the company has positioned itself as a key player in the future of energy efficiency. Investors see Eaton as a linchpin in the push for smarter energy use, especially after its May acquisition of Exertherm, which bolstered its foothold in continuous thermal monitoring.
Despite a slight dip in shares following its Q2 earnings, Eaton delivered solid numbers - 8.3% annual sales growth to $6.4 billion and a 33.5% jump in net income to $993 million. The market may have blinked, but Eaton's trajectory is clearly upward, fueled by a world increasingly reliant on its innovations.
In fact, for the current fiscal year, ending in December, analysts expect Eaton to report an EPS growth of 17.3% year over year to $10.70. The company’s earnings surprise history is robust. It beat the consensus estimates in each of the past four quarters. Its EPS of $2.73 for the last reported quarter surpassed the consensus estimates by 4.6%.
Among the 16 analysts covering the ETN stock, the consensus rating is a “Moderate Buy.” That’s based on nine “Strong Buy” ratings, two “Moderate Buys,” four “Holds,” and one “Strong Sell.”
This configuration has been stable over the past months.
On Aug. 2, RBC Capital analyst Deane Dray maintained a “Buy” rating with a price target of $371.
ETN’s mean price target of $342.07 represents a premium of 14.9% from current price levels. The Street-high target of $385 indicates a potential upside of 29.3%.
On the date of publication, Aditya Sarawgi did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
