The 10-second takeaway
For the quarter ended Dec. 31 (Q4), Eaton missed on revenues and missed expectations on earnings per share.
Compared to the prior-year quarter, revenue increased, and GAAP earnings per share increased significantly.
Gross margins dropped, operating margins expanded, net margins expanded.
Eaton reported revenue of $4.03 billion. The 15 analysts polled by S&P Capital IQ expected revenue of $4.16 billion. Sales were 10% higher than the prior-year quarter's $3.66 billion.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions.
Non-GAAP EPS came in at $1.08. The earnings estimates compiled by S&P Capital IQ averaged $1.11 per share on the same basis. GAAP EPS of $1.07 for Q4 were 31% higher than the prior-year quarter's $0.82 per share.
Source: S&P Capital IQ. Quarterly periods. Figures may be non-GAAP to maintain comparability with estimates.
For the quarter, gross margin was 30.2%, 20 basis points worse than the prior-year quarter. Operating margin was 10.1%, 50 basis points better than the prior-year quarter. Net margin was 9.0%, 140 basis points better than the prior-year quarter.
Next quarter's average estimate for revenue is $4.00 billion. On the bottom line, the average EPS estimate is $0.90.
Next year's average estimate for revenue is $17.05 billion. The average EPS estimate is $4.42.
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 819 members out of 840 rating the stock outperform, and 21 members rating it underperform. Among 301 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 299 give Eaton a green thumbs-up, and two give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Eaton is outperform, with an average price target of $52.42.
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Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor of Motley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.