Based on the aggregated intelligence of 125,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, industrial parts provider Eaton (NYSE:ETN) has earned a coveted five-star ranking. Our data has shown that five-star stocks outperform the market by a significant margin; conversely, one-star stocks woefully lag the market average.

With that in mind, let's take a closer look at Eaton's business, and see what CAPS investors are saying about the stock right now.

Eaton facts

Headquarters (founded)

Cleveland (1916)

Market Cap

$7.44 billion


Industrial Machinery

Trailing-12-Month Revenue

$15.26 billion


CEO Alexander Cutler (since 2000)

CFO Richard Fearon (since 2002)

Return on Equity (average last three years)


Dividend Yield



Parker Hannifin (NYSE:PH)

Emerson Electric (NYSE:EMR)

CAPS members bullish on ETN also bullish on:

General Electric (NYSE:GE)

Transocean (NYSE:RIG)

CAPS members bearish on ETN also bearish on:

Northrop Grumman (NYSE:NOC)

Corning (NYSE:GLW)

Sources: Capital IQ, a division of Standard & Poor's, and Motley Fool CAPS.

Over on CAPS, some 98% of the 608 members who have rated Eaton believe the stock will outperform the S&P 500 going forward. These bulls include CAPS All-Star TMFSmashy (aka Toby Shute) and RetireOrExpire.

Earlier this month, TMFSmashy noted three of the company's strong points: "Good long-term record w/ relatively low earnings volatility for an industrial firm, a rising dividend, and valued at ~8x normalized earnings."

In a pitch from late last month, RetireOrExpire agrees, tapping Eaton as a strong business priced for imperfection:

The stock has been hammered down because of auto issues, however auto is only about 28% of the company revenue. Even in that 28% ETN supplies parts for both foriegn and domestic players. ... Granted losing 20% of your revenue isn't great but that assumes all 3 of the BIG 3 fail and fail completely (as in orders drop to $0.00). Even still the company has been hammered down 50%. Even worst case scenario the company only has room to go up. Given the other 3/4th of the company deal w/ power supply, switching, and distribution it could benefit from [a] stimulus09 play.

What do you think about Eaton, or any other stock for that matter? Make your voice heard on Motley Fool CAPS today. More than 125,000 investors are waiting to hear what you have to say. CAPS is 100% free, so simply click here to get started.

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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.