What to Expect From Eaton's Q3 2024 Earnings Report

Headquartered in Dublin, Ireland, Eaton Corporation plc (ETN) is a global leader in power management technology, specializing in a wide range of electrical components and systems. Valued at $138.2 billion by market cap, the company offers hydraulic products, fluid connectors, electrical power distribution, control equipment, truck drivetrain systems, engine components, and various controls. The industrial titan is expected to announce its fiscal third-quarter earnings for 2024 before the market opens on Tuesday, Oct. 29. 

Ahead of the event, analysts expect ETN to report a profit of $2.80 per share on a diluted basis, up 13.4% from $2.47 per share in the year-ago quarter. The company has consistently surpassed Wall Street’s EPS estimates in each of its last four quarterly reports. Its EPS of $2.73 in the recent quarter surpassed the consensus estimate by 4.6%.

For the full year, analysts project ETN to report an EPS of $10.75, up 17.9% from $9.12 in fiscal 2023.

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ETN stock has significantly outperformed the S&P 500’s ($SPX) 34.4% gains over the past 52 weeks, with shares up 62.1% during this period. Similarly, it has outshined the Industrial Select Sector SPDR Fund’s (XLI) 35.8% gains over the same time frame.

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Eaton's robust market momentum over the past year has been driven by increased project activity linked to megatrends, reindustrialization, and infrastructure spending. As a major supplier for EV charging and aerospace industries, Eaton is seen as a key beneficiary of rising investments in energy efficiency. Moreover, key innovations, such as the AbleEdge home energy management system and its collaboration with Tesla, Inc. (TSLA), position Eaton to capitalize on the energy transition. 

Nevertheless, the stock fell 2.3% on Aug. 1 after announcing Q2 earnings despite beating earnings expectations and meeting revenue forecasts at $6.4 billion. The decline was likely triggered by investor concerns over the company's cautious Q3 2024 guidance and slowing growth in its Vehicle segment. It expects its adjusted earnings per share to be between $2.73 and $2.83 for the third quarter.

Analysts’ consensus opinion on ETN stock is reasonably bullish, with a “Moderate Buy” rating overall. Out of 18 analysts covering the stock, 11 advise a “Strong Buy” rating, two suggest a “Moderate Buy,” and five give a “Hold” rating. 

The average analyst price target for ETN is $351, indicating a potential upside of 3.8% from the current levels. 

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On the date of publication, Kritika Sarmah did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.