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Eaton

NYSE:ETN
Snowflake Description

Established dividend payer with adequate balance sheet.

The Snowflake is generated from 30 checks in 5 different areas, read more below.
ETN
NYSE
$29B
Market Cap
  1. Home
  2. US
  3. Capital Goods
Company description

Eaton Corporation plc operates as a power management company worldwide. The last earnings update was 39 days ago. More info.


Add to Portfolio Compare Print
  • Eaton has significant price volatility in the past 3 months.
ETN Share Price and Events
7 Day Returns
-4.4%
NYSE:ETN
-2.9%
US Electrical
-2.8%
US Market
1 Year Returns
-14.4%
NYSE:ETN
-26.1%
US Electrical
-15.9%
US Market
ETN Shareholder Return
  7 Day 30 Day 90 Day 1 Year 3 Year 5 Year
Eaton (ETN) -4.4% -23.2% -25.3% -14.4% -4.5% 3.7%
US Electrical -2.9% -26.4% -32.7% -26.1% -13.6% -7.3%
US Market -2.8% -18.8% -24% -15.9% 2.8% 13.3%
1 Year Return vs Industry and Market
  • ETN outperformed the Electrical industry which returned -26.1% over the past year.
  • ETN outperformed the Market in United States of America which returned -15.9% over the past year.
Price Volatility
ETN
Industry
5yr Volatility vs Market

ETN Value

 Is Eaton undervalued based on future cash flows and its price relative to the stock market?

Value is all about what a company is worth versus what price it is available for. If you went into a grocery store and all the bananas were on sale at half price, they could be considered undervalued.
INTRINSIC VALUE BASED ON FUTURE CASH FLOWS
Here we compare the current share price of Eaton to its discounted cash flow analysis.value.

The discounted cash flow value is simply looking at what the company is worth today, based on estimates of how much money it is expected to make in the future.
Raw Data

Below are the data sources, inputs and calculation used to determine the intrinsic value for Eaton.

NYSE:ETN Discounted Cash Flow Data Sources
Data Point Source Value
Valuation Model 2 Stage Free Cash Flow to Equity
Levered Free Cash Flow Average of 21 Analyst Estimates (S&P Global) See below
Discount Rate (Cost of Equity) See below 10%
Perpetual Growth Rate 10-Year US Government Bond Rate 1.7%

An important part of a discounted cash flow is the discount rate, below we explain how it has been calculated.

Calculation of Discount Rate/ Cost of Equity for NYSE:ETN
Data Point Calculation/ Source Result
Risk-Free Rate 10-Year US Govt Bond Rate 1.7%
Equity Risk Premium S&P Global 6.5%
Electrical Unlevered Beta Simply Wall St/ S&P Global 1.11
Re-levered Beta = Unlevered beta (1 + (1- tax rate) (Debt/Equity))
= 1.115 (1 + (1- 12.5%) (30.17%))
1.274
Levered Beta Levered Beta limited to 0.8 to 2.0
(practical range for a stable firm)
1.27
Discount Rate/ Cost of Equity = Cost of Equity = Risk Free Rate + (Levered Beta * Equity Risk Premium)
= 1.74% + (1.274 * 6.51%)
10.04%

Discounted Cash Flow Calculation for NYSE:ETN using 2 Stage Free Cash Flow to Equity Model

The calculations below outline how an intrinsic value for Eaton is arrived at by discounting future cash flows to their present value using the 2 stage method. We try to start with analysts estimates of free cash flow, however if these are not available we use the most recent financial results. In the 1st stage we continue to grow the free cash flow over a 10 year period, with the growth rate trending towards the perpetual growth rate used in the 2nd stage. The 2nd stage assumes the company grows at a stable rate into perpetuity.

Note: Free cash flow to equity valuations ignore the company's cash or debt.

NYSE:ETN DCF 1st Stage: Next 10 year cash flow forecast
Levered FCF (USD, Millions) Source Present Value
Discounted (@ 10.04%)
2020 2,801.73 Analyst x11 2,546.21
2021 2,918.50 Analyst x8 2,410.43
2022 2,534.50 Analyst x2 1,902.37
2023 2,684.00 Analyst x1 1,830.85
2024 2,647.33 Est @ -1.37% 1,641.15
2025 2,635.83 Est @ -0.43% 1,484.99
2026 2,641.58 Est @ 0.22% 1,352.50
2027 2,659.40 Est @ 0.67% 1,237.44
2028 2,685.84 Est @ 0.99% 1,135.77
2029 2,718.55 Est @ 1.22% 1,044.76
Present value of next 10 years cash flows $16,586.00
NYSE:ETN DCF 2nd Stage: Terminal Value
Calculation Result
Terminal Value = FCF2029 × (1 + g) ÷ (Discount Rate – g)
= $2,718.55 × (1 + 1.74%) ÷ (10.04% – 1.74%)
$33,342.22
Present Value of Terminal Value = Terminal Value ÷ (1 + r)10
= $33,342.22 ÷ (1 + 10.04%)10
$12,813.65
NYSE:ETN Total Equity Value
Calculation Result
Total Equity Value = Present value of next 10 years cash flows + Terminal Value
= $16,586.00 + $12,813.65
$29,399.65
Equity Value per Share
(USD)
= Total value / Shares Outstanding
= $29,399.65 / 411.44
$71.46
NYSE:ETN Discount to Share Price
Calculation Result
Value per share (USD) From above. $71.46
Current discount Discount to share price of $71.25
= -1 x ($71.25 - $71.46) / $71.46
0.3%

Learn more about our DCF calculations in Simply Wall St’s analysis model .

Current Discount
Amount off the current price Eaton is available for.
Intrinsic value
0%
Share price is $71.25 vs Future cash flow value of $71.46
Current Discount Checks
For Eaton to be considered undervalued it must be available for at least 20% below the current price. Less than 40% is even better.
  • Eaton's share price is below the future cash flow value, but not at a moderate discount (< 20%).
  • Eaton's share price is below the future cash flow value, but not at a substantial discount (< 40%).
PRICE RELATIVE TO MARKET
We can also value a company based on what the stock market is willing to pay for it. This is similar to the price of fruit (e.g. Mangoes or Avocados) increasing when they are out of season, or how much your home is worth.

The amount the stock market is willing to pay for Eaton's earnings, growth and assets is considered below, and whether this is a fair price.
Price based on past earnings
Are Eaton's earnings available for a low price, and how does this compare to other companies in the same industry?
Raw Data
NYSE:ETN PE (Price to Earnings) Ratio Data Sources
Data Point Source Value
Earnings Per Share * Company Filings (2019-12-31) in USD $5.28
NYSE:ETN Share Price ** NYSE (2020-04-03) in USD $71.25
United States of America Electrical Industry PE Ratio Median Figure of 30 Publicly-Listed Electrical Companies 13.7x
United States of America Market PE Ratio Median Figure of 2,947 Publicly-Listed Companies 12.21x

* Trailing twelve months (TTM) annual GAAP earnings per share excluding extraordinary items.

** Primary Listing of Eaton.

NYSE:ETN PE (Price to Earnings) Ratio Calculation
Calculation Outcome
PE Ratio

= NYSE:ETN Share Price ÷ EPS (both in USD)

= 71.25 ÷ 5.28

13.5x

Learn more about our ratios and growth rates in Simply Wall St’s analysis model >

  • Eaton is good value based on earnings compared to the US Electrical industry average.
  • Eaton is overvalued based on earnings compared to the United States of America market.
Price based on expected Growth
Does Eaton's expected growth come at a high price?
Raw Data
NYSE:ETN PEG (Price to Earnings to Growth) Ratio Data Sources
Data Point Source Value
PE Ratio See PE Ratio Section 13.5x
Net Income Annual Growth Rate See Future Growth Section.
Line of Best Fit* through Consensus Estimate Earnings of 21 Analysts
1.3%per year
United States of America Electrical Industry PEG Ratio Median Figure of 20 Publicly-Listed Electrical Companies 1.44x
United States of America Market PEG Ratio Median Figure of 2,010 Publicly-Listed Companies 0.88x

*Line of best fit is calculated by linear regression .

NYSE:ETN PEG (Price to Earnings to Growth) Ratio Calculation
Calculation Outcome
PEG Ratio

= PE Ratio ÷ Net Income Annual Growth Rate

= 13.5x ÷ 1.3%

10.78x

Learn more about our ratios and growth rates in Simply Wall St’s analysis model >

  • Eaton is poor value based on expected growth next year.
Price based on value of assets
What value do investors place on Eaton's assets?
Raw Data
NYSE:ETN PB (Price to Book) Ratio Data Sources
Data Point Source Value
Book Value per Share Company Filings (2019-12-31) in USD $38.91
NYSE:ETN Share Price * NYSE (2020-04-03) in USD $71.25
United States of America Electrical Industry PB Ratio Median Figure of 56 Publicly-Listed Electrical Companies 1.17x
United States of America Market PB Ratio Median Figure of 5,146 Publicly-Listed Companies 1.2x
NYSE:ETN PB (Price to Book) Ratio Calculation
Calculation Outcome
PB Ratio

= NYSE:ETN Share Price ÷ Book Value per Share (both in USD)

= 71.25 ÷ 38.91

1.83x

* Primary Listing of Eaton.

Learn more about our ratios and growth rates in Simply Wall St’s analysis model >

  • Eaton is overvalued based on assets compared to the US Electrical industry average.
X
Value checks
We assess Eaton's value by looking at:
  1. Is the discounted cash flow value less than 20%, or 40% of the share price? (2 checks) ( Click here or on bar chart for details of DCF calculation. )
  2. Is the PE ratio less than the market average, and/ or less than the Electrical industry average (and greater than 0)? (2 checks)
  3. Is the PEG ratio within a reasonable range (0 to 1)? (1 check)
  4. Is the PB ratio less than the Electrical industry average (and greater than 0)? (1 check)
  5. Eaton has a total score of 1/6, see the detailed checks below.

    Note: We use GAAP Earnings per Share in all our calculations including PE and PEG Ratio.

    Full details on the Value part of the Simply Wall St company analysis model.

ETN Future Performance

 How is Eaton expected to perform in the next 1 to 3 years based on estimates from 21 analysts?

The future performance of a company is measured in the same way as past performance, by looking at estimated growth and how much profit it is expected to make.

Future estimates come from professional analysts. Just like forecasting the weather, they don’t always get it right!
Annual Growth Rate
1.3%
Expected annual growth in earnings.
Earnings growth vs Low Risk Savings
Is Eaton expected to grow at an attractive rate?
  • Eaton's earnings growth is positive but not above the low risk savings rate of 1.7%.
Growth vs Market Checks
  • Eaton's earnings growth is positive but not above the United States of America market average.
  • Eaton's revenues are expected to decrease over the next 1-3 years, this is below the United States of America market average.
Annual Growth Rates Comparison
Raw Data
NYSE:ETN Future Growth Rates Data Sources
Data Point Source Value (per year)
NYSE:ETN Future Earnings Growth Rate Line of Best Fit* through Consensus Estimate Earnings of 21 Analysts 1.3%
NYSE:ETN Future Revenue Growth Rate Line of Best Fit* through Consensus Estimate Revenue of 21 Analysts -3.5%
United States of America Electrical Industry Earnings Growth Rate Market Cap Weighted Average 7.3%
United States of America Electrical Industry Revenue Growth Rate Market Cap Weighted Average 1.8%
United States of America Market Earnings Growth Rate Market Cap Weighted Average 13.4%
United States of America Market Revenue Growth Rate Market Cap Weighted Average 7%

*Line of best fit is calculated by linear regression .

Industry and Market average data is calculated daily.

Learn more about our growth rate calculations in Simply Wall St’s analysis model.

Analysts growth expectations
Raw Data
NYSE:ETN Analysts Growth Expectations Data Sources
Data Point Source Value
Past Financials Company Filings (3 months ago) See Below
Future Estimates Average of up to 21 Analyst Estimates (S&P Global) See Below
All numbers in USD Millions and using Trailing twelve months (TTM) annual period rather than quarterly.
NYSE:ETN Future Estimates Data
Date (Data in USD Millions) Revenue Cash Flow Net Income * Avg. No. Analysts
2023-12-31 19,603 1
2022-12-31 19,419 3,274 2,287 7
2021-12-31 19,255 3,332 2,179 19
2020-12-31 19,154 3,358 2,032 21
2020-04-05
NYSE:ETN Past Financials Data
Date (Data in USD Millions) Revenue Cash Flow Net Income *
2019-12-31 21,390 3,451 2,211
2019-09-30 21,611 3,334 2,390
2019-06-30 21,709 3,251 2,205
2019-03-31 21,663 2,870 2,179
2018-12-31 21,609 2,658 2,145
2018-09-30 21,363 2,717 2,148
2018-06-30 21,162 2,467 3,133
2018-03-31 20,807 2,542 3,039
2017-12-31 20,404 2,666 2,985
2017-09-30 20,058 2,425 2,849
2017-06-30 19,834 2,474 1,971
2017-03-31 19,782 2,645 1,946

*GAAP earnings excluding extraordinary items.

Super high growth metrics
High Growth Checks
  • Eaton's earnings are expected to grow by 1.3% yearly, however this is not considered high growth (20% yearly).
  • Eaton's revenue is expected to decrease over the next 1-3 years, this is not considered high growth.
Past and Future Earnings per Share
The accuracy of the analysts who estimate the future performance data can be gauged below. We look back 3 years and see if they were any good at predicting what actually occurred. We also show the highest and lowest estimates looking forward to see if there is a wide range.
Raw Data
NYSE:ETN Past and Future Earnings per Share
Data Point Source Value
Past Financials Company Filings (3 months ago) See Below
Future Estimates Average of up to 21 Analyst Estimates (S&P Global) See Below

All data from Eaton Company Filings, last reported 3 months ago, and in Trailing twelve months (TTM) annual period rather than quarterly.

NYSE:ETN Future Estimates Data
Date (Data in USD Millions) EPS * EPS High Estimate EPS Low Estimate Avg. No. Analysts
2023-12-31
2022-12-31 6.14 7.23 5.00 4.00
2021-12-31 5.69 6.55 4.05 13.00
2020-12-31 5.08 5.79 3.60 14.00
2020-04-05
NYSE:ETN Past Financials Data
Date (Data in USD Millions) EPS *
2019-12-31 5.28
2019-09-30 5.65
2019-06-30 5.16
2019-03-31 5.06
2018-12-31 4.94
2018-09-30 4.92
2018-06-30 7.13
2018-03-31 6.88
2017-12-31 6.72
2017-09-30 6.37
2017-06-30 4.38
2017-03-31 4.30

*GAAP earnings excluding extraordinary items.

Performance in 3 years
In the same way as past performance we look at the future estimated return (profit) compared to the available funds. We do this looking forward 3 years.
  • Eaton is not expected to efficiently use shareholders’ funds in the future (Return on Equity less than 20%).
X
Future performance checks
We assess Eaton's future performance by looking at:
  1. Is the annual earnings growth rate expected to beat the low risk savings rate, plus a premium to keep pace with inflation?
  2. Is the annual earnings growth rate expected to beat the average growth rate in earnings of the United States of America market? (1 check)
  3. Is the annual revenue growth rate expected to beat the average growth rate in revenue of the United States of America market? (1 check)
  4. Is the annual earnings growth rate expected to be above 20%? (1 check)
  5. Is the annual revenue growth rate expected to be above 20%? (1 check)
  6. Is the Return on Equity in 3 years expected to be over 20%? (1 check)
Some of the above checks will fail if the company is expected to be loss making in the relevant year.
Eaton has a total score of 0/6, see the detailed checks below.

Note 1: We use GAAP Net Income Excluding Exceptional Items for our Earnings in all our calculations.

Full details on the Future part of the Simply Wall St company analysis model.

ETN Past Performance

  How has Eaton performed over the past 5 years?

The past performance of a company can be measured by how much growth it has experienced and how much profit it makes relative to the funds and assets it has available.
Past earnings growth
Below we compare Eaton's growth in the last year to its industry (Electrical).
Past Earnings growth analysis
We also check if the company has grown in the past 5 years, and whether it has maintained that growth in the year.
  • Eaton's year on year earnings growth rate has been positive over the past 5 years.
  • Eaton's 1-year earnings growth is less than its 5-year average (3.1% vs 5.6%)
  • Eaton's earnings growth has exceeded the US Electrical industry average in the past year (3.1% vs -1.4%).
Earnings and Revenue History
Eaton's revenue and profit over the past 5 years is shown below, any years where they have experienced a loss will show up in red.
Raw Data

All data from Eaton Company Filings, last reported 3 months ago, and in Trailing twelve months (TTM) annual period rather than quarterly.

NYSE:ETN Past Revenue, Cash Flow and Net Income Data
Date (Data in USD Millions) Revenue Net Income * G+A Expenses R&D Expenses
2019-12-31 21,390.00 2,211.00 3,595.00 606.00
2019-09-30 21,611.00 2,390.00 3,577.00 599.00
2019-06-30 21,709.00 2,205.00 3,550.00 590.00
2019-03-31 21,663.00 2,179.00 3,556.00 584.00
2018-12-31 21,609.00 2,145.00 3,542.00 584.00
2018-09-30 21,363.00 2,148.00 3,538.00 583.00
2018-06-30 21,162.00 3,133.00 3,585.00 592.00
2018-03-31 20,807.00 3,039.00 3,576.00 597.00
2017-12-31 20,404.00 2,985.00 3,560.00 584.00
2017-09-30 20,058.00 2,849.00 3,563.00 585.00
2017-06-30 19,834.00 1,971.00 3,482.00 584.00
2017-03-31 19,782.00 1,946.00 3,488.00 583.00
2016-12-31 19,747.00 1,916.00 3,521.00 587.00
2016-09-30 19,937.00 1,950.00 3,514.00 597.00
2016-06-30 20,153.00 1,873.00 3,565.00 607.00
2016-03-31 20,445.00 1,917.00 3,569.00 616.00
2015-12-31 20,855.00 1,972.00 3,591.00 625.00
2015-09-30 21,363.00 2,028.00 3,616.00 626.00
2015-06-30 21,888.00 2,184.00 3,667.00 633.00
2015-03-31 22,283.00 1,820.00 3,744.00 643.00
2014-12-31 22,552.00 1,793.00 3,785.00 647.00
2014-09-30 22,514.00 1,691.00 3,873.00 658.00
2014-06-30 22,393.00 1,599.00 3,873.00 661.00
2014-03-31 22,228.00 1,922.00 3,848.00 654.00
2013-12-31 22,046.00 1,861.00 3,840.00 644.00
2013-09-30 20,852.00 1,561.00 3,509.00 605.00
2013-06-30 19,195.00 1,396.00 3,220.00 541.00

*GAAP earnings excluding extraordinary items.

Performance last year
We want to ensure a company is making the most of what it has available. This is done by comparing the return (profit) to a company's available funds, assets and capital.
  • Eaton has not efficiently used shareholders’ funds last year (Return on Equity less than 20%).
  • Eaton used its assets more efficiently than the US Electrical industry average last year based on Return on Assets.
  • Eaton has improved its use of capital last year versus 3 years ago (Return on Capital Employed).
X
Past performance checks
We assess Eaton's performance over the past 5 years by checking for:
  1. Has earnings increased in past 5 years? (1 check)
  2. Has the earnings growth in the last year exceeded that of the Electrical industry? (1 check)
  3. Is the recent earnings growth over the last year higher than the average annual growth over the past 5 years? (1 check)
  4. Is the Return on Equity (ROE) higher than 20%? (1 check)
  5. Is the Return on Assets (ROA) above industry average? (1 check)
  6. Has the Return on Capital Employed (ROCE) increased from 3 years ago? (1 check)
The above checks will fail if the company has reported a loss in the most recent earnings report. Some checks require at least 3 or 5 years worth of data.
Eaton has a total score of 4/6, see the detailed checks below.

Note: We use GAAP Net Income excluding extraordinary items in all our calculations.

Full details on the Past part of the Simply Wall St company analysis model.

ETN Health

 How is Eaton's financial health and their level of debt?

A company's financial position is much like your own financial position, it includes everything you own (assets) and owe (liabilities).

The boxes below represent the relative size of what makes up Eaton's finances.

The net worth of a company is the difference between its assets and liabilities.
Net Worth
  • Eaton is able to meet its short term (1 year) commitments with its holdings of cash and other short term assets.
  • Eaton's long term commitments exceed its cash and other short term assets.
Balance sheet
This treemap shows a more detailed breakdown of Eaton's finances. If any of them are yellow this indicates they may be out of proportion and red means they relate to one of the checks below.
Assets
Liabilities and shares
The 'shares' portion represents any funds contributed by the owners (shareholders) and any profits.
  • High level of physical assets or inventory.
  • Debt is covered by short term assets, assets are 1x debt.
Historical Debt
Nearly all companies have debt. Debt in itself isn’t bad, however if the debt is too high, or the company can’t afford to pay the interest on its debts this may have impacts in the future.

The graphic below shows equity (available funds) and debt, we ideally want to see the red area (debt) decreasing.

If there is any debt we look at the companies capability to repay it, and whether the level has increased over the past 5 years.
Raw Data

All data from Eaton Company Filings, last reported 3 months ago.

NYSE:ETN Past Debt and Equity Data
Date (Data in USD Millions) Total Equity Total Debt Cash & Short Term Investments
2019-12-31 16,133.00 8,366.00 591.00
2019-09-30 15,900.00 8,078.00 830.00
2019-06-30 16,361.00 8,099.00 797.00
2019-03-31 16,267.00 7,575.00 446.00
2018-12-31 16,142.00 7,551.00 440.00
2018-09-30 16,789.00 7,308.00 506.00
2018-06-30 16,725.00 7,737.00 492.00
2018-03-31 17,301.00 7,916.00 827.00
2017-12-31 17,290.00 7,768.00 1,096.00
2017-09-30 16,636.00 8,779.00 1,636.00
2017-06-30 15,594.00 8,615.00 840.00
2017-03-31 15,199.00 8,224.00 523.00
2016-12-31 14,998.00 8,286.00 747.00
2016-09-30 15,446.00 8,450.00 707.00
2016-06-30 15,364.00 8,433.00 470.00
2016-03-31 15,563.00 8,654.00 574.00
2015-12-31 15,231.00 8,416.00 445.00
2015-09-30 15,413.00 8,672.00 568.00
2015-06-30 15,803.00 8,761.00 430.00
2015-03-31 15,264.00 9,340.00 802.00
2014-12-31 15,839.00 9,044.00 1,026.00
2014-09-30 16,645.00 9,031.00 990.00
2014-06-30 17,042.00 9,059.00 1,265.00
2014-03-31 17,111.00 9,364.00 1,144.00
2013-12-31 16,863.00 9,626.00 1,710.00
2013-09-30 16,117.00 9,736.00 1,341.00
2013-06-30 15,431.00 9,806.00 998.00
  • Eaton's level of debt (51.9%) compared to net worth is high (greater than 40%).
  • The level of debt compared to net worth has been reduced over the past 5 years (57.1% vs 51.9% today).
  • Debt is well covered by operating cash flow (41.3%, greater than 20% of total debt).
  • Interest payments on debt are well covered by earnings (EBIT is 12.1x coverage).
X
Financial health checks
We assess Eaton's financial health by checking for:
  1. Are short term assets greater than short term liabilities? (1 check)
  2. Are short term assets greater than long term liabilities? (1 check)
  3. Has the debt to equity ratio increased in the past 5 years? (1 check)
  4. Is the debt to equity ratio over 40%? (1 check)
  5. Is the debt covered by operating cash flow? (1 check)
  6. Are earnings greater than 5x the interest on debt (if company pays interest at all)? (1 check)
  7. Eaton has a total score of 4/6, see the detailed checks below.
For companies that are loss making and have been so on average in the past we replace the last 2 checks with:
  1. Does cash and short term investments cover stable operating expenses (recurring G&A and R&D) for more than 3 years? (1 check)
  2. Does cash and short term investments cover growing operating expenses (recurring G&A and R&D) for more than 3 years? (1 check)


Full details on the Health part of the Simply Wall St company analysis model.

ETN Dividends

 What is Eaton's current dividend yield, its reliability and sustainability?

Dividends are regular cash payments to you from the company, similar to a bank paying you interest on a savings account.
Annual Dividend Income
Dividend payments
4.1%
Current annual income from Eaton dividends. Estimated to be 4.27% next year.
If you bought $2,000 of Eaton shares you are expected to receive $82 in your first year as a dividend.
Dividend Amount
Here we look how much dividend is being paid, if any. Is it above what you can get in a savings account? It is up there with the best dividend paying companies?
  • Eaton's pays a higher dividend yield than the bottom 25% of dividend payers in United States of America (2.07%).
  • Eaton's dividend is below the markets top 25% of dividend payers in United States of America (5.82%).
Annualized Historical and Future Dividends
It is important to see if the dividend for a company is stable, and not wildly increasing/decreasing each year. This graph shows you the historical rate to count toward your assessment of the stock.

We also check to see if the dividend has increased in the past 10 years.
Raw Data
NYSE:ETN Annualized Past and Future Dividends
Data Point Source Value
Past Annualized Dividend Yield S&P Global Market Data See Below
Past Dividends per Share Company Filings/ Annualized Dividend Payments See Below
Future Dividends per Share Estimates Average of up to 21 Analyst Estimates (S&P Global) See Below
United States of America Electrical Industry Average Dividend Yield Market Cap Weighted Average of 19 Stocks 3.2%
United States of America Market Average Dividend Yield Market Cap Weighted Average of 1936 Stocks 3.1%
United States of America Minimum Threshold Dividend Yield 10th Percentile 1.1%
United States of America Bottom 25% Dividend Yield 25th Percentile 2.1%
United States of America Top 25% Dividend Yield 75th Percentile 5.8%

Industry and Market average data is calculated daily.

Note all dividend per share amounts are annualized and not quarterly or other period.

NYSE:ETN Future Dividends Estimate Data
Date (Data in $) Dividend per Share (annual) Avg. No. Analysts
2023-12-31
2022-12-31 3.17 5.00
2021-12-31 3.11 12.00
2020-12-31 2.93 12.00
2020-04-05
NYSE:ETN Past Annualized Dividends Data
Date (Data in $) Dividend per share (annual) Avg. Yield (%)
2020-02-25 2.920 3.661
2020-02-04 2.920 2.839
2019-10-22 2.840 3.063
2019-07-23 2.840 3.515
2019-04-23 2.840 3.540
2019-02-27 2.840 3.476
2018-10-23 2.640 3.629
2018-07-24 2.640 3.187
2018-04-24 2.640 3.424
2018-02-28 2.640 3.330
2017-10-24 2.400 3.004
2017-07-25 2.400 3.196
2017-04-25 2.400 3.099
2017-02-22 2.400 3.271
2016-10-25 2.280 3.375
2016-07-26 2.280 3.508
2016-04-26 2.280 3.704
2016-02-24 2.280 3.748
2015-10-27 2.200 4.140
2015-07-21 2.200 3.939
2015-04-21 2.200 3.149
2015-02-25 2.200 3.210
2014-10-21 1.960 2.907
2014-07-22 1.960 2.935
2014-04-22 1.960 2.608
2014-02-26 1.960 2.655
2013-10-22 1.680 2.310
2013-07-24 1.680 2.500
2013-04-24 1.680 2.578
2013-02-27 1.680 2.763
2012-09-26 1.520 2.911
2012-07-25 1.520 3.326
2012-04-25 1.520 3.676
2012-01-26 1.520 3.058
2011-10-26 1.360 3.019
2011-07-27 1.360 3.376
2011-04-27 1.360 2.701
2011-01-27 1.360 2.529
2010-10-27 1.160 2.355
2010-07-21 1.160 2.939
2010-04-28 1.000 2.840
2010-01-27 1.000 2.790
2009-10-28 1.000 3.091
2009-07-20 1.000 3.586
2009-04-22 1.000 4.448

Learn more about our ratios and growth rates in Simply Wall St’s analysis model >

  • Dividends per share have been stable in the past 10 years.
  • Dividends per share have increased over the past 10 years.
Current Payout to shareholders
What portion of Eaton's earnings are paid to the shareholders as a dividend.
  • Dividends paid are covered by earnings (1.9x coverage).
Future Payout to shareholders
  • Dividends after 3 years are expected to be covered by earnings (1.9x coverage).
X
Income/ dividend checks
We assess Eaton's dividend by checking for:
  1. Firstly is the company paying a notable dividend (greater than 1.1%) - if not then the rest of the checks are ignored.
  2. Is current dividend yield above the bottom 25% of dividend payers? (1 check)
  3. Is current dividend yield above the top 25% of dividend payers? (1 check)
  4. Have they paid a dividend for 10 years, and during this period has the dividend been volatile (drop of more than 25%)? (1 check)
  5. If they have paid a dividend for 10 years has it increased in this time? (1 check)
  6. How sustainable is the dividend, can Eaton afford to pay it from its earnings today and in 3 years (Payout ratio less than 90%)? (2 checks)
  7. Eaton has a total score of 5/6, see the detailed checks below.


Full details on the Dividends part of the Simply Wall St company analysis model.

ETN Management

 What is the CEO of Eaton's salary, the management and board of directors tenure and is there insider trading?

Management is one of the most important areas of a company. We look at unreasonable CEO compensation, how long the team and board of directors have been around for and insider trading.
CEO
Craig Arnold
COMPENSATION $19,962,364
AGE 59
CEO Bio

Mr. Craig Arnold has been the Chairman of Eaton Corporation plc since June 1, 2016 and Chief Executive Officer at Eaton Corporation since June 01, 2016. Mr. Arnold serves as Chief Executive Officer of Eaton Corporation since June 1, 2016 and serves as its President since September 1, 2015. Mr. Arnold served as Chief Operating Officer of Eaton Corporation from September 1, 2015 to May 31, 2016. Mr. Arnold serves as Principal Executive Officer of Eaton Corporation plc. He served as the President and Chief Operating Officer of Eaton Corporation plc since September 1, 2015 until June 2016. Mr. Arnold served as Vice Chairman, President and Chief Operating Officer for Industrial Sector at Eaton Corporation plc since February 1, 2009 until August 31, 2015. He served as President of Fluid Power Group and Senior Vice President of Eaton Corporation since October 25, 2000 until 2008. He served as Chief Executive Officer of Fluid Power Group at Eaton Corporation from October 25, 2000 to January 31, 2009. He was responsible for Eaton’s hydraulics, aerospace, filtration, truck, automotive and general products businesses. He joined Eaton in 2000 as group executive of the Fluid Power Group from General Electric Company. Mr. Arnold was employed in a series of progressively more responsible positions at General Electric Company from 1983 to 2000. Mr. Arnold was responsible for Eaton’s Fluid Power business, which includes Aeroquip, aerospace and hydraulics businesses. He served as Corporate Vice President of General Electric and President of GE Lighting Services Ltd. from 1999 to 2000. He served as Corporate Vice President and President of GE Plastics, Greater China, from 1998 to 1999 and at GE Appliances, Asia, from 1997 to 1998. Mr. Arnold served as Managing Director of Structured Products Europe at GE Plastics from 1995 to 1997. He started his professional career with General Electric in 1983, initially holding a series of progressively responsible sales, marketing and product management positions. He was responsible for GE’s lighting business in Europe, the Middle East and India. He was responsible for GE’s e-commerce business in Europe across all of its businesses and served as GE’s senior management "account executive" for all GE businesses in the United Kingdom. He serves as a Director at University Hospitals Health System, Inc. He has been an Independent Director at Medtronic plc since January 26, 2015. He has been a Director of Eaton Corporation plc since September 1, 2015. He has been an Independent Director of Unocal Corporation since February 1, 2004. He serves as a Director of Mallinckrodt LLC, Eaton Corporation, Tyco Healthcare Ltd and Tyco Healthcare Group, LP. He serves as a Member of the advisory Board of the Salvation Army of Greater Cleveland Partnership and the United Way of Greater Cleveland. Mr. Arnold served as a Director of Covidien PLC since June 29, 2007 until January 2015. Mr. Arnold received a Bachelor’s Degree in Psychology from California State University in San Bernardino and a Master of Business Administration from Pepperdine University. He has years of senior management and executive leadership experience. He is a Member of The Business Roundtable and The Business Council.

CEO Compensation
  • Craig's compensation has increased by more than 20% in the past year whilst earnings grew less than 20%.
  • Craig's remuneration is higher than average for companies of similar size in United States of America.
Management Team Tenure

Average tenure and age of the Eaton management team in years:

6.2
Average Tenure
55
Average Age
  • The average tenure for the Eaton management team is over 5 years, this suggests they are a seasoned and experienced team.
Management Team

Craig Arnold

TITLE
Chairman & CEO
COMPENSATION
$20M
AGE
59

Rick Fearon

TITLE
Vice Chairman and Chief Financial & Planning Officer
COMPENSATION
$8M
AGE
63

Uday Yadav

TITLE
President & COO of Electrical Sector
COMPENSATION
$6M
AGE
55
TENURE
4.6 yrs

Brian Brickhouse

TITLE
President of Americas Region & Electrical Sector
COMPENSATION
$4M
AGE
55

Heath Monesmith

TITLE
President & COO of Industrial Sector
COMPENSATION
$3M
AGE
48
TENURE
3.1 yrs

Ken Semelsberger

TITLE
Principal Accounting Officer
AGE
57

Ram Ramakrishnan

TITLE
Chief Technology Officer & Executive VP
TENURE
7.8 yrs

William Blausey

TITLE
Chief Information Officer & Senior VP
AGE
54
TENURE
14.3 yrs

Yan Jin

TITLE
Senior Vice President of Investor Relations
TENURE
1.1 yrs

Deborah Severs

TITLE
Senior Vice President of Global Ethics & Compliance
TENURE
8.2 yrs
Board of Directors Tenure

Average tenure and age of the Eaton board of directors in years:

7.4
Average Tenure
63.5
Average Age
  • The tenure for the Eaton board of directors is about average.
Board of Directors

Rick Fearon

TITLE
Vice Chairman and Chief Financial & Planning Officer
COMPENSATION
$8M
AGE
63

Todd Bluedorn

TITLE
Independent Director
COMPENSATION
$349K
AGE
55
TENURE
10.3 yrs

Craig Arnold

TITLE
Chairman & CEO
COMPENSATION
$20M
AGE
59
TENURE
3.8 yrs

Gerald Smith

TITLE
Independent Director
COMPENSATION
$345K
AGE
68
TENURE
7.4 yrs

Sandra Pianalto

TITLE
Independent Director
COMPENSATION
$335K
AGE
64
TENURE
5.8 yrs

Dorothy Thompson

TITLE
Independent Director
COMPENSATION
$315K
AGE
58
TENURE
3.8 yrs

Chris Connor

TITLE
Lead Director
COMPENSATION
$380K
AGE
62
TENURE
4.3 yrs

Debbie McCoy

TITLE
Independent Director
COMPENSATION
$343K
AGE
64
TENURE
20.3 yrs

Mike Critelli

TITLE
Independent Director
COMPENSATION
$331K
AGE
70
TENURE
22.3 yrs

Greg Page

TITLE
Independent Director
COMPENSATION
$329K
AGE
68
TENURE
17 yrs
Who owns this company?
Recent Insider Trading
  • Eaton individual insiders have sold more shares than they have bought in the past 3 months.
Recent Insider Transactions
Announced Type Name Entity Role Start End Shares Max Price ($) Value ($)
11. Mar 20 Buy Gregory Page Individual 09. Mar 20 09. Mar 20 4,000 $84.49 $337,940
11. Mar 20 Buy April Boise Individual 10. Mar 20 10. Mar 20 1,150 $86.60 $99,590
05. Mar 20 Sell Joao Faria Individual 04. Mar 20 04. Mar 20 -3,000 $96.62 $-289,845
04. Mar 20 Sell Deborah McCoy Individual 03. Mar 20 03. Mar 20 -3,000 $93.50 $-280,500
20. Feb 20 Sell Ken Semelsberger Individual 19. Feb 20 19. Feb 20 -22,000 $104.58 $-2,300,760
10. Dec 19 Sell Uday Yadav Individual 09. Dec 19 09. Dec 19 -4,575 $92.68 $-424,011
14. Nov 19 Sell Michael Critelli Individual 12. Nov 19 12. Nov 19 -10,000 $92.00 $-920,000
06. Nov 19 Sell Richard Fearon Individual 04. Nov 19 04. Nov 19 -34,000 $90.05 $-3,061,700
16. Sep 19 Sell Ken Semelsberger Individual 13. Sep 19 13. Sep 19 -17,000 $88.69 $-1,507,730
12. Sep 19 Sell Joao Faria Individual 11. Sep 19 11. Sep 19 -1,000 $86.89 $-86,890
12. Sep 19 Sell Nanda Cheruvatath Individual 11. Sep 19 11. Sep 19 -2,500 $86.83 $-217,063
03. Sep 19 Sell Deborah McCoy Individual 29. Aug 19 29. Aug 19 -3,000 $79.18 $-237,540
21. May 19 Buy Olivier Leonetti Individual 17. May 19 17. May 19 630 $79.08 $49,818
14. May 19 Buy Dorothy Thompson Individual 13. May 19 13. May 19 1,655 $78.54 $129,984
X
Management checks
We assess Eaton's management by checking for:
  1. Is the CEO's compensation unreasonable compared to market cap? (1 check)
  2. Has the CEO's compensation increased more than 20% whilst the EPS is down more then 20%? (1 check)
  3. Is the average tenure of the management team less than 2 years? (1 check)
  4. Is the average tenure of the board of directors team less than 3 years? (1 check)
  5. Eaton has a total score of 0/6, this is not included on the snowflake, see the detailed checks below.


Note: We use the top 6 management executives and board members in our calculations.

Note 2: Insider trading include any internal stakeholders and these transactions .

Full details on the Management part of the Simply Wall St company analysis model.

ETN News

Simply Wall St News

Is Eaton (NYSE:ETN) A Risky Investment?

Debt assists a business until the business has trouble paying it off, either with new capital or with free cash flow. … Over the last three years, Eaton recorded free cash flow worth a fulsome 81% of its EBIT, which is stronger than we'd usually expect. … Our View Eaton's conversion of EBIT to free cash flow suggests it can handle its debt as easily as Cristiano Ronaldo could score a goal against an under 14's goalkeeper.

Simply Wall St -

Is Eaton Corporation plc's (NYSE:ETN) Capital Allocation Ability Worth Your Time?

Specifically, we're going to calculate its Return On Capital Employed (ROCE), in the hopes of getting some insight into the business. … Analysts use this formula to calculate return on capital employed: Return on Capital Employed = Earnings Before Interest and Tax (EBIT) ÷ (Total Assets - Current Liabilities) Or for Eaton: 0.11 = US$3.0b ÷ (US$32b - US$4.5b) (Based on the trailing twelve months to June 2019.) So, Eaton has an ROCE of 11%. … Due to the way ROCE is calculated, a high level of current liabilities makes a company look as though it has less capital employed, and thus can (sometimes unfairly) boost the ROCE.

Simply Wall St -

Is Now An Opportune Moment To Examine Eaton Corporation plc (NYSE:ETN)?

According to my valuation model, Eaton seems to be fairly priced at around 10.33% above my intrinsic value, which means if you buy Eaton today, you’d be paying a relatively fair price for it. … This is because Eaton’s beta (a measure of share price volatility) is high, meaning its price movements will be exaggerated relative to the rest of the market. … ETN’s optimistic future growth appears to have been factored into the current share price, with shares trading around its fair value.

Simply Wall St -

Eaton Corporation plc (NYSE:ETN) Is About To Go Ex-Dividend, And It Pays A 0.9% Yield

Eaton paid out more than half (53%) of its earnings last year, which is a regular payout ratio for most companies. … NYSE:ETN Historical Dividend Yield, July 29th 2019 Have Earnings And Dividends Been Growing? … Earnings per share have been growing modestly and Eaton paid out a bit over half of its earnings and free cash flow last year.

Simply Wall St -

Investors Who Bought Eaton (NYSE:ETN) Shares Three Years Ago Are Now Up 25%

Unfortunately for shareholders, while the Eaton Corporation plc (NYSE:ETN) share price is up 25% in the last three years, that falls short of the market return. … During three years of share price growth, Eaton achieved compound earnings per share growth of 6.9% per year. … As it happens, Eaton's TSR for the last 3 years was 39%, which exceeds the share price return mentioned earlier.

Simply Wall St -

Is Eaton Corporation plc's (NYSE:ETN) CEO Overpaid Relative To Its Peers?

View our latest analysis for Eaton How Does Craig Arnold's Compensation Compare With Similar Sized Companies? … At the time of writing our data says that Eaton Corporation plc has a market cap of US$34b, and is paying total annual CEO compensation of US$15m. … On average over the last three years, Eaton Corporation plc has grown earnings per share (EPS) by 12% each year (using a line of best fit).

Simply Wall St -

Eaton Corporation plc (NYSE:ETN): What Does The Future Look Like?

Since Eaton Corporation plc (NYSE:ETN) released its earnings in March 2019, the consensus outlook from analysts appear fairly confident, as a 15% increase in profits is expected in the upcoming year, against the past 5-year average growth rate of 8.5%. … I've plotted out each year's earnings expectations and inserted a line of best fit to calculate an annual growth rate from the slope in order to understand the overall trajectory of ETN's earnings growth over these next few years. … NYSE:ETN Past and Future Earnings, June 19th 2019 This results in an annual growth rate of 5.9% based on the most recent earnings level of US$2.1b to the final forecast of US$2.7b by 2022.

Simply Wall St -

Does Eaton Corporation plc (NYSE:ETN) Have A Good P/E Ratio?

The formula for P/E is: Price to Earnings Ratio = Share Price ÷ Earnings per Share (EPS) Or for Eaton: P/E of 15.63 = $79.08 ÷ $5.06 (Based on the trailing twelve months to March 2019.) Is A High Price-to-Earnings Ratio Good? … The higher the P/E ratio, the higher the price tag of a business, relative to its trailing earnings. … A Limitation: P/E Ratios Ignore Debt and Cash In The Bank It's important to note that the P/E ratio considers the market capitalization, not the enterprise value.

Simply Wall St -

Calculating The Fair Value Of Eaton Corporation plc (NYSE:ETN)

Today, we will estimate the stock's intrinsic value by estimating the company's future cash flows and discounting them to their present value. … Where possible we use analyst estimates, but when these aren't available we extrapolate the previous free cash flow (FCF) from the last estimate or reported value. … Generally we assume that a dollar today is more valuable than a dollar in the future, so we need to discount the sum of these future cash flows to arrive at a present value estimate: 10-year free cash flow (FCF) forecast 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 Levered FCF ($, Millions) $2.58k $2.77k $2.95k $2.99k $3.04k $3.11k $3.18k $3.25k $3.34k $3.42k Growth Rate Estimate Source Analyst x11 Analyst x9 Analyst x5 Analyst x1 Est @ 1.82% Est @ 2.09% Est @ 2.28% Est @ 2.42% Est @ 2.51% Est @ 2.58% Present Value ($, Millions) Discounted @ 11.55% $2.32k $2.23k $2.12k $1.93k $1.76k $1.61k $1.48k $1.36k $1.25k $1.15k Present Value of 10-year Cash Flow (PVCF)= $17.20b "Est" = FCF growth rate estimated by Simply Wall St After calculating the present value of future cash flows in the intial 10-year period, we need to calculate the Terminal Value, which accounts for all future cash flows beyond the first stage.

Simply Wall St -

Do Institutions Own Eaton Corporation plc (NYSE:ETN) Shares?

See our latest analysis for Eaton NYSE:ETN Ownership Summary, May 24th 2019 What Does The Institutional Ownership Tell Us About Eaton? … We can see that Eaton does have institutional investors; and they hold 81% of the stock. … Insider Ownership Of Eaton The definition of company insiders can be subjective, and does vary between jurisdictions.

Simply Wall St -

ETN Company Info

Description

Eaton Corporation plc operates as a power management company worldwide. Its Electrical Products segment offers electrical and industrial components, wiring devices, and structural support systems; and residential, single phase power quality, emergency lighting and fire detection, and circuit protection and lighting products. The company’s Electrical Systems and Services segment provides power distribution and assemblies, three phase power quality products, hazardous duty electrical equipment, explosion-proof instrumentation, utility power distribution equipment, power reliability equipment, and services. Its Hydraulics segment offers power, controls and sensing, and fluid conveyance products; and filtration systems solutions, industrial drum and disc brakes, and golf grips. The company’s Aerospace segment provides hydraulic power generation and fuel systems, controls and sensing, and fluid and conveyance products for commercial and military use. Its Vehicle segment offers transmissions, clutches, hybrid power systems, superchargers, engine valves and valve actuation systems, cylinder heads, locking and limited slip differentials, transmission controls, and fuel vapor components for vehicle industry. The company’s eMobility segment provides voltage inverters, converters, fuses, circuit protection units, vehicle controls, power distribution products, fuel tank isolation valves, and commercial vehicle hybrid systems. It serves industrial, institutional, governmental, utility, commercial, residential, information technology, renewable energy, marine, agriculture, oil and gas, construction, mining, forestry, material handling, truck and bus, machine tools, molding, primary metals, and power generation markets, as well as original equipment manufacturers and aftermarket customers. The company was founded in 1916 and is based in Dublin, Ireland.

Details
Name: Eaton Corporation plc
ETN
Exchange: NYSE
Founded: 1916
$29,314,882,616
411,436,949
Website: http://www.eaton.com
Address: Eaton Corporation plc
Eaton House,
30 Pembroke Road,
Dublin,
Co. Dublin, 4,
Ireland
Listings
Exchange Symbol Ticker Symbol Security Exchange Country Currency Listed on
NYSE ETN Common Shares New York Stock Exchange US USD 02. Jan 1968
DB 3EC Common Shares Deutsche Boerse AG DE EUR 02. Jan 1968
LSE 0Y3K Common Shares London Stock Exchange GB USD 02. Jan 1968
BMV ETN1 N Common Shares Bolsa Mexicana de Valores MX MXN 02. Jan 1968
BOVESPA E1TN34 BDR EACH 2 REPR 1 SHS UNSPON Bolsa de Valores de Sao Paulo BR BRL 27. Jan 2020
Number of employees
Current staff
Staff numbers
101,000
Eaton employees.
Industry
Electrical Components and Equipment
Capital Goods
Company Analysis and Financial Data Status
Area Date (UTC time)
Company Analysis updated: 2020/04/05 05:42
End of day share price update: 2020/04/03 00:00
Last estimates confirmation: 2020/04/03
Last earnings filing: 2020/02/26
Last earnings reported: 2019/12/31
Last annual earnings reported: 2019/12/31


All dates and times in UTC. All financial data provided by Standard & Poor’s Capital IQ.

Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.