EATON CORP PLC (ETN) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:ETN - IE00B8KQN827 - Common Stock
345.89 USD
+4.2 (+1.23%)
345.89 USD
0 (0%)
Taking everything into account, ETN scores 6 out of 10 in our fundamental rating. ETN was compared to 90 industry peers in the Electrical Equipment industry. While ETN has a great profitability rating, there are some minor concerns on its financial health. ETN has a correct valuation and a medium growth rate.
1. Profitability
1.1 Basic Checks
In the past year ETN was profitable.
In the past year ETN had a positive cash flow from operations.
Each year in the past 5 years ETN has been profitable.
Each year in the past 5 years ETN had a positive operating cash flow.
1.2 Ratios
With an excellent Return On Assets value of 9.66%, ETN belongs to the best of the industry, outperforming 91.11% of the companies in the same industry.
With an excellent Return On Equity value of 20.84%, ETN belongs to the best of the industry, outperforming 92.22% of the companies in the same industry.
ETN has a Return On Invested Capital of 13.15%. This is amongst the best in the industry. ETN outperforms 88.89% of its industry peers.
The Average Return On Invested Capital over the past 3 years for ETN is in line with the industry average of 10.41%.
The 3 year average ROIC (10.83%) for ETN is below the current ROIC(13.15%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 9.66% | ||
| ROE | 20.84% | ||
| ROIC | 13.15% |
ROA(3y)8.43%
ROA(5y)7.2%
ROE(3y)17.29%
ROE(5y)14.88%
ROIC(3y)10.83%
ROIC(5y)9.09%
1.3 Margins
ETN has a better Profit Margin (14.74%) than 88.89% of its industry peers.
ETN's Profit Margin has improved in the last couple of years.
With an excellent Operating Margin value of 18.84%, ETN belongs to the best of the industry, outperforming 93.33% of the companies in the same industry.
ETN's Operating Margin has improved in the last couple of years.
Looking at the Gross Margin, with a value of 38.10%, ETN belongs to the top of the industry, outperforming 86.67% of the companies in the same industry.
ETN's Gross Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 18.84% | ||
| PM (TTM) | 14.74% | ||
| GM | 38.1% |
OM growth 3Y15.21%
OM growth 5Y7.39%
PM growth 3Y11.77%
PM growth 5Y8.09%
GM growth 3Y5.78%
GM growth 5Y2.99%
2. Health
2.1 Basic Checks
ETN has a Return on Invested Capital (ROIC), which is well above the Cost of Capital (WACC), which means it is creating value.
The number of shares outstanding for ETN has been reduced compared to 1 year ago.
The number of shares outstanding for ETN has been reduced compared to 5 years ago.
Compared to 1 year ago, ETN has an improved debt to assets ratio.
2.2 Solvency
An Altman-Z score of 5.19 indicates that ETN is not in any danger for bankruptcy at the moment.
ETN has a better Altman-Z score (5.19) than 80.00% of its industry peers.
ETN has a debt to FCF ratio of 3.21. This is a good value and a sign of high solvency as ETN would need 3.21 years to pay back of all of its debts.
With a decent Debt to FCF ratio value of 3.21, ETN is doing good in the industry, outperforming 80.00% of the companies in the same industry.
A Debt/Equity ratio of 0.51 indicates that ETN is somewhat dependend on debt financing.
ETN has a Debt to Equity ratio (0.51) which is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.51 | ||
| Debt/FCF | 3.21 | ||
| Altman-Z | 5.19 |
ROIC/WACC1.82
WACC7.22%
2.3 Liquidity
A Current Ratio of 1.28 indicates that ETN should not have too much problems paying its short term obligations.
With a Current ratio value of 1.28, ETN is not doing good in the industry: 63.33% of the companies in the same industry are doing better.
ETN has a Quick Ratio of 1.28. This is a bad value and indicates that ETN is not financially healthy enough and could expect problems in meeting its short term obligations.
With a Quick ratio value of 0.79, ETN is not doing good in the industry: 64.44% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.28 | ||
| Quick Ratio | 0.79 |
3. Growth
3.1 Past
ETN shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 9.98%, which is quite good.
Measured over the past years, ETN shows a quite strong growth in Earnings Per Share. The EPS has been growing by 13.71% on average per year.
Looking at the last year, ETN shows a quite strong growth in Revenue. The Revenue has grown by 8.24% in the last year.
Measured over the past years, ETN shows a small growth in Revenue. The Revenue has been growing by 3.07% on average per year.
EPS 1Y (TTM)9.98%
EPS 3Y17.66%
EPS 5Y13.71%
EPS Q2Q%8.1%
Revenue 1Y (TTM)8.24%
Revenue growth 3Y8.22%
Revenue growth 5Y3.07%
Sales Q2Q%10.13%
3.2 Future
Based on estimates for the next years, ETN will show a quite strong growth in Earnings Per Share. The EPS will grow by 10.78% on average per year.
ETN is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 9.21% yearly.
EPS Next Y12.58%
EPS Next 2Y13.27%
EPS Next 3Y12.78%
EPS Next 5Y10.78%
Revenue Next Year9.97%
Revenue Next 2Y9.58%
Revenue Next 3Y8.9%
Revenue Next 5Y9.21%
3.3 Evolution
Although the future EPS growth is still strong, it is not able to hold up the even more excellent growth rate of the past years.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 29.90, the valuation of ETN can be described as expensive.
Based on the Price/Earnings ratio, ETN is valued a bit cheaper than 75.56% of the companies in the same industry.
The average S&P500 Price/Earnings ratio is at 26.31. ETN is around the same levels.
A Price/Forward Earnings ratio of 24.96 indicates a rather expensive valuation of ETN.
Based on the Price/Forward Earnings ratio, ETN is valued a bit cheaper than 71.11% of the companies in the same industry.
Compared to an average S&P500 Price/Forward Earnings ratio of 36.59, ETN is valued a bit cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 29.9 | ||
| Fwd PE | 24.96 |
4.2 Price Multiples
73.33% of the companies in the same industry are more expensive than ETN, based on the Enterprise Value to EBITDA ratio.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of ETN indicates a somewhat cheap valuation: ETN is cheaper than 73.33% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 40.46 | ||
| EV/EBITDA | 23.89 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
The excellent profitability rating of ETN may justify a higher PE ratio.
ETN's earnings are expected to grow with 12.78% in the coming years. This may justify a more expensive valuation.
PEG (NY)2.38
PEG (5Y)2.18
EPS Next 2Y13.27%
EPS Next 3Y12.78%
5. Dividend
5.1 Amount
ETN has a Yearly Dividend Yield of 1.22%. Purely for dividend investing, there may be better candidates out there.
Compared to an average industry Dividend Yield of 3.45, ETN pays a better dividend. On top of this ETN pays more dividend than 88.89% of the companies listed in the same industry.
With a Dividend Yield of 1.22, ETN pays less dividend than the S&P500 average, which is at 2.34.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.22% |
5.2 History
The dividend of ETN has a limited annual growth rate of 5.70%.
ETN has paid a dividend for at least 10 years, which is a reliable track record.
ETN has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)5.7%
Div Incr Years15
Div Non Decr Years34
5.3 Sustainability
40.54% of the earnings are spent on dividend by ETN. This is a bit on the high side, but may be sustainable.
ETN's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP40.54%
EPS Next 2Y13.27%
EPS Next 3Y12.78%
345.89
+4.2 (+1.23%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryElectrical Equipment
Earnings (Last)
Earnings (Next)
Inst Owners86.86%
Inst Owner Change-4.29%
Ins Owners0.06%
Ins Owner Change-0.1%
Market Cap134.34B
Revenue(TTM)26.63B
Net Income(TTM)3.93B
Analysts78.38
Price Target407.74 (17.88%)
Short Float %1.73%
Short Ratio2.82
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.22% |
Yearly Dividend3.79
Dividend Growth(5Y)5.7%
DP40.54%
Div Incr Years15
Div Non Decr Years34
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-0.2%
Min EPS beat(2)-0.42%
Max EPS beat(2)0.03%
EPS beat(4)1
Avg EPS beat(4)-0.29%
Min EPS beat(4)-0.48%
Max EPS beat(4)0.03%
EPS beat(8)5
Avg EPS beat(8)1.09%
EPS beat(12)8
Avg EPS beat(12)1.75%
EPS beat(16)10
Avg EPS beat(16)1.39%
Revenue beat(2)1
Avg Revenue beat(2)-0.78%
Min Revenue beat(2)-2.25%
Max Revenue beat(2)0.69%
Revenue beat(4)2
Avg Revenue beat(4)-0.78%
Min Revenue beat(4)-2.45%
Max Revenue beat(4)0.92%
Revenue beat(8)2
Avg Revenue beat(8)-0.73%
Revenue beat(12)5
Avg Revenue beat(12)-0.18%
Revenue beat(16)6
Avg Revenue beat(16)-0.42%
PT rev (1m)2.4%
PT rev (3m)2.93%
EPS NQ rev (1m)-0.46%
EPS NQ rev (3m)-0.38%
EPS NY rev (1m)0%
EPS NY rev (3m)0.11%
Revenue NQ rev (1m)0.06%
Revenue NQ rev (3m)0.18%
Revenue NY rev (1m)0%
Revenue NY rev (3m)0%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 29.9 | ||
| Fwd PE | 24.96 | ||
| P/S | 5.04 | ||
| P/FCF | 40.46 | ||
| P/OCF | 32.75 | ||
| P/B | 7.13 | ||
| P/tB | N/A | ||
| EV/EBITDA | 23.89 |
EPS(TTM)11.57
EY3.34%
EPS(NY)13.86
Fwd EY4.01%
FCF(TTM)8.55
FCFY2.47%
OCF(TTM)10.56
OCFY3.05%
SpS68.57
BVpS48.51
TBVpS-5.4
PEG (NY)2.38
PEG (5Y)2.18
Graham Number112.38
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 9.66% | ||
| ROE | 20.84% | ||
| ROCE | 16.1% | ||
| ROIC | 13.15% | ||
| ROICexc | 13.39% | ||
| ROICexgc | 40.27% | ||
| OM | 18.84% | ||
| PM (TTM) | 14.74% | ||
| GM | 38.1% | ||
| FCFM | 12.47% |
ROA(3y)8.43%
ROA(5y)7.2%
ROE(3y)17.29%
ROE(5y)14.88%
ROIC(3y)10.83%
ROIC(5y)9.09%
ROICexc(3y)11.53%
ROICexc(5y)9.59%
ROICexgc(3y)38.67%
ROICexgc(5y)33.99%
ROCE(3y)12.98%
ROCE(5y)10.88%
ROICexgc growth 3Y6.49%
ROICexgc growth 5Y11.09%
ROICexc growth 3Y21.4%
ROICexc growth 5Y9.81%
OM growth 3Y15.21%
OM growth 5Y7.39%
PM growth 3Y11.77%
PM growth 5Y8.09%
GM growth 3Y5.78%
GM growth 5Y2.99%
F-Score8
Asset Turnover0.66
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.51 | ||
| Debt/FCF | 3.21 | ||
| Debt/EBITDA | 1.59 | ||
| Cap/Depr | 79.39% | ||
| Cap/Sales | 2.94% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 68.33% | ||
| Profit Quality | 84.54% | ||
| Current Ratio | 1.28 | ||
| Quick Ratio | 0.79 | ||
| Altman-Z | 5.19 |
F-Score8
WACC7.22%
ROIC/WACC1.82
Cap/Depr(3y)77.39%
Cap/Depr(5y)68.5%
Cap/Sales(3y)3.13%
Cap/Sales(5y)2.9%
Profit Quality(3y)86.8%
Profit Quality(5y)103.14%
High Growth Momentum
Growth
EPS 1Y (TTM)9.98%
EPS 3Y17.66%
EPS 5Y13.71%
EPS Q2Q%8.1%
EPS Next Y12.58%
EPS Next 2Y13.27%
EPS Next 3Y12.78%
EPS Next 5Y10.78%
Revenue 1Y (TTM)8.24%
Revenue growth 3Y8.22%
Revenue growth 5Y3.07%
Sales Q2Q%10.13%
Revenue Next Year9.97%
Revenue Next 2Y9.58%
Revenue Next 3Y8.9%
Revenue Next 5Y9.21%
EBIT growth 1Y9.02%
EBIT growth 3Y24.68%
EBIT growth 5Y10.68%
EBIT Next Year24.92%
EBIT Next 3Y15.55%
EBIT Next 5Y12.95%
FCF growth 1Y19.04%
FCF growth 3Y30.36%
FCF growth 5Y4.2%
OCF growth 1Y16.8%
OCF growth 3Y25.99%
OCF growth 5Y4.62%
EATON CORP PLC / ETN FAQ
Can you provide the ChartMill fundamental rating for EATON CORP PLC?
ChartMill assigns a fundamental rating of 6 / 10 to ETN.
Can you provide the valuation status for EATON CORP PLC?
ChartMill assigns a valuation rating of 5 / 10 to EATON CORP PLC (ETN). This can be considered as Fairly Valued.
How profitable is EATON CORP PLC (ETN) stock?
EATON CORP PLC (ETN) has a profitability rating of 9 / 10.
What is the financial health of EATON CORP PLC (ETN) stock?
The financial health rating of EATON CORP PLC (ETN) is 5 / 10.
How sustainable is the dividend of EATON CORP PLC (ETN) stock?
The dividend rating of EATON CORP PLC (ETN) is 6 / 10 and the dividend payout ratio is 40.54%.