In the latest close session, Eaton (ETN) was down 1.79% at $337.59. The stock’s change was more than the S&P 500’s daily loss of 2.06%. Meanwhile, the Dow experienced a drop of 1.76%, and the technology-dominated Nasdaq saw a decrease of 2.39%.
The power management company’s shares have seen an increase of 7.29% over the last month, not keeping up with the Industrial Products sector’s gain of 8.4% and outstripping the S&P 500’s gain of 1.63%.
The investment community will be paying close attention to the earnings performance of Eaton in its upcoming release. It is anticipated that the company will report an EPS of $3.33, marking a 17.67% rise compared to the same quarter of the previous year. Alongside, our most recent consensus estimate is anticipating revenue of $7.11 billion, indicating a 14% upward movement from the same quarter last year.
For the entire fiscal year, the Zacks Consensus Estimates are projecting earnings of $12.07 per share and a revenue of $27.51 billion, representing changes of +11.76% and 0%, respectively, from the prior year.
It’s also important for investors to be aware of any recent modifications to analyst estimates for Eaton. Recent revisions tend to reflect the latest near-term business trends. Hence, positive alterations in estimates signify analyst optimism regarding the business and profitability.
Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To capitalize on this, we’ve crafted the Zacks Rank, a unique model that incorporates these estimate changes and offers a practical rating system.
The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has shifted 0.7% downward. Currently, Eaton is carrying a Zacks Rank of #3 (Hold).
Investors should also note Eaton’s current valuation metrics, including its Forward P/E ratio of 25.33. This expresses a premium compared to the average Forward P/E of 23.24 of its industry.
It’s also important to note that ETN currently trades at a PEG ratio of 2.31. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company’s expected earnings growth rate into account. The Manufacturing – Electronics industry currently had an average PEG ratio of 1.88 as of yesterday’s close.
The Manufacturing – Electronics industry is part of the Industrial Products sector. This group has a Zacks Industry Rank of 91, putting it in the top 38% of all 250+ industries.