ETN - Embedded Expectations Analysis - 2018 01 29
ï€ Eaton Corporation plc (ETN:USA) currently trades near recent highs relative toUAFRS-based (Uniform) Earnings, with a 15.8x Uniform P/E. However, even at these levels, markets appear to have somewhat muted expectations for the firm, and management has concerns about growth, sales, and industry trends
ï€ Management appears to have concerns about the sustainability of operating EPS improvements, and may also be concerned about maintaining
mid-teens growth rates in their commercial components products. Furthermore, they may be concerned about weakness in their military transport and military rotorcraft sales, and may lack confidence in their ability to meet expectations for 25% incremental profits on organic growth in 2018. Additionally, they may be concerned about their opportunities to continue to grow and to be successful as a stand-alone company without automation, and may be downplaying their concerns about fundamental changes in the overall economics of power quality markets
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