Eaton CorporationETN

Morningstar Rating

Stock Research and Analysis

by Morningstar Equity Analysts

Eaton's drive to create a better balance of revenue and a more flexible cost structure paid off in spades in recent years. Although the company will be negatively affected by the current macroeconomic turmoil, we believe its diversification and cost-cutting Read more

Bulls Say

Eaton has used its strong balance sheet to finance value-accretive acquisitions, repurchase shares, and increase dividends.

The move into less capital-intensive businesses and less cyclical businesses should allow the firm to continue to generate consistent shareholder value.

Eaton has transformed itself from a cyclical auto and truck supplier into a premier diversified industrial company. While its end markets are currently experiencing an unusually steep and synchronized downturn, future profits shouldn't display as much volatility. Read more

Bears Say

A continued downturn in North American auto production and a falloff in international production will continue to erode the profitability of the company's automobile segment. Read more

Strategy

Eaton uses the cash generated in its truck and auto businesses to fund acquisitions in its higher-growth segments--fluid power and electrical. Initiated in 2000, this plan has essentially changed the Read more

Management

Sandy Cutler has been running the show since 2000. He leads a 12-member board, 11 of whom are independent, and elections are staggered. We found no significant related transactions with board members, and base salaries are reasonable. Annual cash incentives Read more

Profile

Eaton designs and manufactures hydraulic systems, electrical power control devices, automotive engine air and powertrain control systems, and drivetrain and fuel systems Read more

First Name

Last Name

Email Address

Zip Code

Create Password

Verify Password

(6-15 characters; case sensitive)

What is your occupation or job title?

Select...

Your registration indicates agreement to the terms of use.

Why Housing Could Come Back with a Vengeance
Watch more