The 10-second takeaway
For the quarter ended March 31 (Q1), Eaton missed estimates on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue grew significantly. Non-GAAP earnings per share dropped. GAAP earnings per share dropped.
Margins dropped across the board.
Eaton booked revenue of $5.31 billion. The 17 analysts polled by S&P Capital IQ foresaw revenue of $5.42 billion on the same basis. GAAP reported sales were 34% higher than the prior-year quarter's $3.96 billion.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
EPS came in at $0.84. The 23 earnings estimates compiled by S&P Capital IQ forecast $0.79 per share. Non-GAAP EPS of $0.84 for Q1 were 8.7% lower than the prior-year quarter's $0.92 per share. GAAP EPS of $0.79 for Q1 were 13% lower than the prior-year quarter's $0.91 per share.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 29.7%, 80 basis points worse than the prior-year quarter. Operating margin was 8.8%, 130 basis points worse than the prior-year quarter. Net margin was 7.1%, 80 basis points worse than the prior-year quarter. (Margins calculated in GAAP terms.)
Next quarter's average estimate for revenue is $5.76 billion. On the bottom line, the average EPS estimate is $1.12.
Next year's average estimate for revenue is $22.76 billion. The average EPS estimate is $4.35.
The stock has a five-star rating (out of five) at Motley Fool CAPS, with 847 members out of 869 rating the stock outperform, and 22 members rating it underperform. Among 242 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 240 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 $67.33.
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