One-glance verdict
Overvalued
$166.22 our estimate vs market $408.72
Wall Street consensus: $451.73 (171.8% higher than our fair-value estimate)
146% above our estimate, beyond the bull case
Fundamentals snapshot
Eaton Corporation plc
ETN · NYQ · Industrials · Specialty Industrial Machinery
Current price
$408.72
52-week range
$311.92 - $436.74
Market cap
$158.71B
Balance sheet
Stretched
21.61x Strong cushion
Net debt $21.08B. Interest coverage shows how many times profit covers the interest bill.
What stands out
3 Rewards
3 Risks
3 rewards · 3 risks
- Reward Revenue grew 3.9% last year.
- Reward Returns 20.8% on equity, ahead of 16% of its peers.
- Risk Stock trades 31.9% above its 5-year average P/E.
- Risk Net debt grew 13.7% over 3 years.
What this company does
Eaton Corporation plc
Eaton makes the essential, behind-the-scenes equipment that manages and protects electrical power for buildings, data centers, and utilities. The company makes most of its money from these electrical products, and it also sells specialized parts for vehicles and airplanes. This matters because as the world uses more electricity for things like AI and electric cars, the need for Eaton's power management hardware is expected to grow.
How the company got here
Eaton was founded in 1911 by Joseph O. Eaton to build a better truck axle. For much of its history, the company grew by acquiring other companies, expanding from car and truck parts into a wide range of industrial manufacturing. A major turning point was the acquisition of Cutler-Hammer in 1978, which significantly grew its electrical business. This shift accelerated over the years, and today, Eaton is primarily a power management company, helping the world use electrical, hydraulic, and mechanical power more efficiently and safely.
What it actually does
Eaton is a power management company that makes products to help manage electricity, fluids, and mechanical power. Think of the complex systems that keep the lights on in a hospital, run machinery in a factory, or control the systems on an airplane; Eaton makes critical components for all of them. Their products range from circuit breakers in your home's electrical panel to massive systems that ensure uninterrupted power for data centers (the buildings that house the computers for the internet). They also create hydraulic systems for industrial machinery and fuel systems for aircraft.
Electrical Americas
This is Eaton's largest business segment, focused on selling electrical products and systems in North and South America. Customers include businesses that construct or manage large buildings, utility companies that provide electricity, and data centers. They buy things like circuit breakers, switchgear (large panels of switches and fuses that control power distribution), and uninterruptible power supplies (UPS), which are like giant battery backups to keep power on during an outage. This segment is a major part of the company's sales.
Electrical Global
This segment does essentially the same thing as the Electrical Americas business, but for the rest of the world, including Europe, the Middle East, Africa, and the Asia-Pacific region. It provides a similar range of power management products and services to industrial, commercial, and utility customers. Because product standards and how customers buy can differ greatly from one region to another, Eaton separates this into its own business unit. Together with Electrical Americas, the electrical business makes up the majority of Eaton's revenue (the total money it brings in from sales).
Aerospace
The Aerospace division creates and sells a wide variety of systems and components for commercial and military aircraft. This includes things you might not see, like fuel systems, hydraulic pumps that move flight controls, and electrical wiring components. Their customers are aircraft manufacturers as well as the aftermarket (the business of providing spare parts and services after the initial sale). This is a high-value business because of the strict safety and certification requirements for aircraft parts.
Vehicle
Returning to its roots, this segment makes parts for traditional cars and commercial trucks. It produces components for engines, transmissions (the system that transfers power from the engine to the wheels), and clutches. While still an important part of the company that generates cash, it is considered a more mature and cyclical business (meaning its sales tend to rise and fall with the broader economy).
eMobility
This is a newer and smaller segment focused on products for electric vehicles (EVs). It combines expertise from Eaton's electrical and vehicle businesses to create components like inverters (which convert battery power for the motor), power distribution units, and fuses for EVs. This business is management's bet on the global shift toward electrification in transportation.
What management is betting on now
Eaton's main strategy is to focus on the major trends of electrification and digitalization. The company is investing heavily in high-growth areas like supporting data centers, which have a huge and growing need for reliable power, especially with the rise of artificial intelligence. They are also focused on modernizing the electrical grid and providing components for renewable energy projects. Management is using acquisitions (buying other companies) to gain new technologies and expand its product offerings in these key areas.
Price history
How the share price has moved
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Earnings history
Last 8 quarters — what happened
Click any quarter to read the call summary and what the numbers say.
FY2024 Q2
$759.00M
FY2024 Q3
$1.13B
FY2024 Q4
$1.34B
FY2025 Q1
$91.00M
FY2025 Q2
$716.00M
FY2025 Q3
$1.17B
FY2025 Q4
$1.57B
FY2026 Q1
$314.00M
Revenue
$7.45B
Net income
$866.00M
Diluted EPS
2.22
Operating cash flow
$507.00M
Free cash flow
$314.00M
Fetching…
Sources
Revenue
$7.05B
Net income
$1.13B
Diluted EPS
2.90
Operating cash flow
$1.97B
Free cash flow
$1.57B
Fetching…
Sources
Revenue
$6.99B
Net income
$1.01B
Diluted EPS
2.59
Operating cash flow
$1.35B
Free cash flow
$1.17B
Fetching…
Sources
Revenue
$7.03B
Net income
$982.00M
Diluted EPS
2.51
Operating cash flow
$918.00M
Free cash flow
$716.00M
Fetching…
Sources
Revenue
$6.38B
Net income
$964.00M
Diluted EPS
2.45
Operating cash flow
$238.00M
Free cash flow
$91.00M
Fetching…
Sources
Revenue
$6.24B
Net income
$971.00M
Diluted EPS
2.45
Operating cash flow
$1.60B
Free cash flow
$1.34B
Fetching…
Sources
Revenue
$6.34B
Net income
$1.01B
Diluted EPS
2.53
Operating cash flow
$1.31B
Free cash flow
$1.13B
Fetching…
Sources
Revenue
$6.35B
Net income
$993.00M
Diluted EPS
2.48
Operating cash flow
$946.00M
Free cash flow
$759.00M
Fetching…
Sources
Is it cheap or expensive?
Fair value $166.22 vs current price $408.72
Wall Street consensus is the average analyst price target: $451.73 (171.8% higher than our fair-value estimate).
Our most-likely fair value is $166.22 a share — about 59.3% below today's price of $408.72, so the stock currently looks expensive (overvalued).
Is it drowning in debt?
Stretched
Net debt $21.1B. Interest coverage 21.6x.
Net debt
$21.08B
Interest coverage
21.61x
Eaton Corporation plc's profit covers its interest bill about 21.6 times over. which is stronger than most peers shown here.
Stretched
Worse cushion
Baseline
Better cushion
ETN
BASELINE
Eaton Corporation plc
Total debt $21.83B Interest coverage 21.61x This is the baseline the peer rows are being compared against.
Total debt $14.06B Interest coverage 9.13x -58% vs ETN Carries about 2.4x less debt cushion than ETN.
Total debt $9.58B Interest coverage 9.93x -54% vs ETN Carries about 2.2x less debt cushion than ETN.
Total debt $4.05B Interest coverage 9.12x -58% vs ETN Carries about 2.4x less debt cushion than ETN.
Total debt $8.24B Interest coverage 11.75x -46% vs ETN Carries about 1.8x less debt cushion than ETN.
Total debt $3.26B Interest coverage 22.02x +2% vs ETN Has roughly the same debt cushion as ETN.
What you should know
The case for and against ETN
3 Rewards
3 Risks
Rewards
-
Revenue grew 3.9% last year.
-
Returns 20.8% on equity, ahead of 16% of its peers.
-
Free cash flow was positive in 10/10 years.
Risks
-
Stock trades 31.9% above its 5-year average P/E.
-
Net debt grew 13.7% over 3 years.
-
Insider ownership is only 0.1% (peer median: 0.2%).
The numbers
All the key metrics, grouped by purpose
Tap any ? icon to learn what it means.
Valuation
How expensive the stock looks
P/E (TTM)
39.91x
Forward P/E
25.97x
P/B
8.05x
P/S
5.56x
EV/EBITDA
30.01x
PEG ratio
3.29x
Profitability
How much profit each dollar creates
Gross margin
37.1%
Operating margin
16.1%
Net margin
14.0%
ROE
20.8%
ROA
7.0%
Health
Liquidity and balance-sheet strength
Debt / equity
1.10x
Current ratio
1.19x
Quick ratio
0.69x
Total debt
$21.83B
Total cash
$751.00M
Growth
How the business has been compounding
Revenue TTM
$28.52B
Revenue 5Y CAGR
8.7%
EPS TTM
10.24
EPS 5Y CAGR
19.4%
Cash flow
How much cash the business throws off
Operating CF TTM
$4.74B
Free CF TTM
$3.55B
FCF margin
12.5%
Dividend
Shareholder payout
Yield
1.0%
Payout ratio
41.3%
Last ex-div date
2026-05-08