If you are looking for a reliable dividend stock with rock-solid earnings and cash flows, then the industrials sector is a pretty good place to start, and the electrical products subsector is a great place to continue.

Process automation and climate control and tools company Emerson Electric (NYSE:EMR), power management company Eaton (NYSE:ETN), and electrical products manufacturer nVent Electric (NYSE:NVT) are excellent options for dividend hunters. Here's why these three industrial stocks are safe bets right now.

Cash flying off a tree with bills for leaves in a field

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1. Emerson Electric

The case for Emerson Electric is based on the idea that its mix of process automation (the process of managing the flow of raw materials into a refined product) with climate controls and tools allows it to generate earnings throughout the business cycle. That's certainly been the case historically, and as you can see below, all three companies are currently generating significant amounts of free cash flow (FCF). Their dividends are very well covered.

EMR Free Cash Flow Per Share Chart

Data by YCharts

Emerson's automation solutions (58% of segment earnings in 2020) are exposed to several heavy industries, including power, chemicals, refining, upstream oil and gas, midstream oil and gas, and clean fuels.

Therefore, it's often seen as a stock with exposure to the price of oil. Still, upstream and midstream oil and gas sales only contributed 27% of automation solutions sales in 2020, and with the price of oil above $60 a barrel through much of 2021, Emerson's energy-related sales could see some improvement next year. Meanwhile, its power and renewables, chemicals/clean fuels, and factory automation (a combined 64% of automation sales in 2020) promise to deliver long-term growth.

A refinery and its environs from above

Image source: Getty Images.

The remaining earnings come from the commercial and residential solutions segment (climate controls, tools, home goods). Its long-term prospects are tied to the megatrends of global adoption of heating and air-conditioning, while the COVID-19 pandemic has highlighted the importance of cold chain distribution.

Following a difficult 2020, Emerson's underlying sales growth turned positive again in the recent second quarter. Management expects full-year underlying sales growth of 3% to 6%, with FCF increasing from $2.55 billion in 2020 to $2.7 billion. That figure will easily cover the $1.2 billion dividend payout, and investors can expect dividends to increase over the long term as well.

Emerson Electric

Data source: Emerson Electric presentations. YOY = year over year. Chart by author.

2. Eaton

By coincidence, Eaton also generated around $2.6 billion in FCF in its fiscal 2020 and paid $1.2 billion in dividends. Eaton also has a very well-covered dividend, and management's mid-term targets imply significant growth in the future.

On its investor day presentation in March, Eaton management outlined midterm targets of organic revenue growth of 4% to 6%, segment operating margin of 21% (compared with a forecast for 17.6% to 18% in 2021), adjusted earnings-per-share (EPS) growth of 11% to 13%, and FCF as a percentage of sales of 14%.

These are ambitious targets, and management plans to increase the dividend "with long-term earnings." To meet these targets, the company's restructuring will need to succeed.

Gloved hands working on large circuit breaker panel

Image source: Getty Images.

In recent years, management has divested $4 billion worth of lower-return business (hydraulics, lighting, automotive fluid conveyance) and invested $6 billion in electrical and aerospace businesses. The idea is to take advantage of favorable trends in areas like renewables (transmission and distribution and storage investment will be needed), data centers, the digitalization of the grid, electric vehicle infrastructure, and increasing electrification of commercial and industrial facilities.

Eaton's dividend per share has risen at a 10% compound annual growth rate since 2010, and if the targets discussed above are reached, investors can expect more growth in the future.

3. nVent Electric

Like Eaton, nVent sees a growth opportunity from the increasing electrification of the global economy. The company provides electrical connection and protection equipment -- in other words, enclosures to protect equipment, electrical and fastening solutions, and thermal management solutions.

Its key end markets include the industrials sector (42% of revenue), commercial and residential buildings (31%), and infrastructure (19%). Thus, nVent has direct exposure to the increasing electrification of factories, buildings, and infrastructure.

The fourth industrial revolution is characterized by the increasing use of digitization and automation in the factory, leading to more electrification. Meanwhile, smart technologies in commercial and residential buildings will also encourage more electrical investment. Finally, increasing investment in data centers, 5G, and power utilities (including renewables) is also a plus for nVent.

NVT Price to Free Cash Flow Chart

Data by YCharts

Trading on just 15 times its current FCF generation and with a very well-covered dividend, nVent looks like an excellent value option for investors.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.