In the world of growth stocks, NYSE:ETN shines as a value proposition.

Our stock screener has spotted EATON CORP PLC (NYSE:ETN) as a growth stock which is not overvalued. NYSE:ETN is scoring great on several growth aspects while it also shows decent health and profitability. At the same time it remains remains attractively priced. We'll dive into each aspect below.

Assessing Growth for NYSE:ETN

To evaluate a stock's growth potential, ChartMill utilizes a Growth Rating on a scale of 0 to 10. This comprehensive assessment considers various growth aspects, including historical and estimated EPS and revenue growth. NYSE:ETN has achieved a 7 out of 10:

• The Earnings Per Share has grown by an impressive 22.04% over the past year.
• ETN shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 11.11% yearly.
• The Revenue has grown by 8.81% in the past year. This is quite good.
• The Earnings Per Share is expected to grow by 14.03% on average over the next years. This is quite good.
• Based on estimates for the next years, ETN will show a quite strong growth in Revenue. The Revenue will grow by 9.25% on average per year.
• The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
• When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.

Understanding NYSE:ETN's Valuation Score

ChartMill assigns a proprietary Valuation Rating to each stock. The score is computed by evaluating various valuation aspects, like price to earnings and free cash flow, both absolutely as relative to the market and industry. NYSE:ETN was assigned a score of 5 for valuation:

• ETN's Price/Earnings ratio is a bit cheaper when compared to the industry. ETN is cheaper than 72.53% of the companies in the same industry.
• ETN's Price/Forward Earnings ratio is a bit cheaper when compared to the industry. ETN is cheaper than 72.53% of the companies in the same industry.
• 70.33% of the companies in the same industry are more expensive than ETN, based on the Enterprise Value to EBITDA ratio.
• Based on the Price/Free Cash Flow ratio, ETN is valued a bit cheaper than 73.63% of the companies in the same industry.
• ETN has an outstanding profitability rating, which may justify a higher PE ratio.
• ETN's earnings are expected to grow with 14.45% in the coming years. This may justify a more expensive valuation.

ChartMill's Evaluation of Health

To gauge a stock's financial health, ChartMill utilizes a Health Rating on a scale of 0 to 10. This comprehensive evaluation encompasses liquidity and solvency, both in absolute terms and in comparison to industry peers. NYSE:ETN has earned a 7 out of 10:

• An Altman-Z score of 5.58 indicates that ETN is not in any danger for bankruptcy at the moment.
• The Altman-Z score of ETN (5.58) is better than 86.81% of its industry peers.
• ETN has a debt to FCF ratio of 2.91. This is a good value and a sign of high solvency as ETN would need 2.91 years to pay back of all of its debts.
• ETN has a better Debt to FCF ratio (2.91) than 76.92% of its industry peers.
• ETN has a Debt/Equity ratio of 0.45. This is a healthy value indicating a solid balance between debt and equity.
• ETN does not score too well on the current and quick ratio evaluation. However, as it has excellent solvency and profitability, these ratios do not necessarly indicate liquidity issues and need to be evaluated against the specifics of the business.

Profitability Insights: NYSE:ETN

ChartMill employs its own Profitability Rating system for stock evaluation. This score, ranging from 0 to 10, is derived from an analysis of diverse profitability metrics and margins. In the case of NYSE:ETN, the assigned 9 is noteworthy for profitability:

• With an excellent Return On Assets value of 9.60%, ETN belongs to the best of the industry, outperforming 92.31% of the companies in the same industry.
• ETN has a Return On Equity of 19.71%. This is amongst the best in the industry. ETN outperforms 92.31% of its industry peers.
• With an excellent Return On Invested Capital value of 12.42%, ETN belongs to the best of the industry, outperforming 91.21% of the companies in the same industry.
• The last Return On Invested Capital (12.42%) for ETN is above the 3 year average (9.14%), which is a sign of increasing profitability.
• ETN has a better Profit Margin (15.31%) than 94.51% of its industry peers.
• ETN's Profit Margin has improved in the last couple of years.
• ETN has a Operating Margin of 18.71%. This is amongst the best in the industry. ETN outperforms 94.51% of its industry peers.
• ETN's Operating Margin has improved in the last couple of years.
• ETN has a better Gross Margin (37.83%) than 89.01% of its industry peers.
• ETN's Gross Margin has improved in the last couple of years.

Our Affordable Growth screener lists more Affordable Growth stocks and is updated daily.

Check the latest full fundamental report of ETN for a complete fundamental analysis.

Disclaimer

Important Note: The content of this article is not intended as trading advice. It is essential to perform your own analysis and exercise caution when making trading decisions. The article presents observations created by automated analysis but does not guarantee any trading or investment outcomes. Always trade responsibly and make independent judgments.