Now trading at a price of $164.0, Eaton has moved 2.97% so far today. In contrast, the S&P 500 index moved 1.61%. Read below for a basic value analysis of Eaton.
Eaton shares moved 6.08% over the last 52 weeks, with a high of $178.75 and a low of $120.62. During this time, the stock outperformed the S&P 500 index by 17.86%. As of January 2022, the company's 50-day average price is $167.0. Eaton Corporation plc is an American Irish-domiciled multinational power management company with 2020 sales of 17. The large-cap Industrials company is based in Dublin, None. Eaton has returned a 2.03% dividend yield over the last 12 months.
Snapshot of the Company's Consistent Operating Margins in Line With the 13.8% Industry Average:
| 2019-12-31 | 2020-12-31 | 2021-12-31 | 2022-12-31 | |
|---|---|---|---|---|
| Revenue (MM) | $21,230 | $18,008 | $20,114 | $20,562 |
| Revenue Growth | n/a | -15.18% | 11.69% | 2.23% |
| Gross Margins | 32.46% | 31.1% | 33.91% | 32.57% |
| Gross Margins Growth | n/a | -4.19% | 9.04% | -3.95% |
| Operating Margins | 17.31% | 7.89% | 12.07% | 11.47% |
| Operating Margins Growth | n/a | -54.42% | 52.98% | -4.97% |
| Earnings Per Share | $5.35 | $3.54 | $5.38 | $6.19 |
| EPS Growth | n/a | -33.83% | 51.98% | 15.06% |
| Diluted Shares (MM) | 413 | 398 | 399 | 398 |
| Free Cash Flow (MM) | $2,864 | $2,555 | $1,588 | $1,935 |
| FCF Growth | n/a | -10.79% | -37.85% | 21.85% |
| Capital Expenditures (MM) | $587 | $389 | $575 | $598 |
| Net Debt / EBITDA | 2.53 | 3.4 | 2.38 | 2.46 |
Eaton Is Too Expensive at Current Levels:
Compared to the Industrials sector's average of 20.49, Eaton has a trailing twelve month P/E ratio of 26.28 and, according to its EPS guidance of 9.16, an expected P/E ratio of 17.9. Eaton's PEG ratio is 1.51 based on its 17.4% annual average growth rate of historical and projected earnings per share. This suggests that the company's shares are overvalued.
The market is giving Eaton a fair value in terms of its book value, since its P/B ratio of 3.994 is consistent with its sector average, which stands at 3.78. The company's shares are currently trading 133.92% above their fair value as expressed by Benjamin Graham's formula:
√(22.5 * 5-year average EPS * book value per share) = √(22.5 * 5.1 * 42.83) = $70.11
Eaton Is the Subject of Mixed Market Indicators:
17 analysts are following Eaton and have set target prices ranging from $148.0 to $210.0 per share. On average, they have given the company a rating of buy. At the current price of $164.0, ETN is trading -11.6% away from its average analyst target price of $185.53 per share, implying an analyst consensus of some upside potential for the stock.
The company has a very low short interest since 1% of the company's shares are tied to short positions. Institutions own 84% of Eaton's shares, while the insider ownership rate stands at 0%. The biggest shareholder is None with a None stake in the company worth approximately None.
