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Eaton Corporation (ETN - Free Report) reported first-quarter 2024 earnings of $2.40 per share, which surpassed the Zacks Consensus Estimate by 5.3%. The bottom line increased 27.7% year over year and beat the earnings guidance of $2.21-$2.31 per share. The improvement was due to increased project activity tied to megatrends, reindustrialization and infrastructure spending.
GAAP earnings for the reported quarter were $2.04, up 28.3% from $1.59 reported in the year-ago quarter. The difference between GAAP and operating earnings for the reported quarter was due to charges of 21 cents for intangible assets amortization, 12 cents for a multi-year restructuring program and 3 cents for acquisitions and divestitures.
Revenues
Total quarterly revenues were $5.94 billion, which surpassed the Zacks Consensus Estimate of $5.9 billion by 0.7%. The first-quarter revenue growth was entirely driven by organic sales growth. Total revenues improved 8.4% year over year.
Eaton Corporation, PLC Price, Consensus and EPS Surprise
Electrical Americas’ total first-quarter sales were $2.69 billion, up 17.3% year over year due to increased organic sales. Operating profit was $785 million, up 50% year over year.
Electrical Global’s total sales were $1.5 billion, on par with the year-ago quarter. Operating profit of $284 million flat year over year.
Aerospace’s total sales were $0.87 billion, up 9% year over year, driven by organic sales growth. Operating profit was $201 million, up 12% year over year.
Vehicle’s total sales were $0.72 billion, down 2% year over year due to a decline in organic sales, partially offset by positive currency translation. Operating profit was $116 million, up 8% year over year.
The eMobility segment’s total sales were $158 million, up 7% year over year, driven by organic sales growth. Operating loss in the quarter was $4 million, on par with the year-ago quarter’s loss.
Highlights of the Release
Selling and administrative expenses were $1.02 billion, up 13.4% year over year.
Research and development expenses were $189 million, up 5.6% year over year. Interest expenses were $30 million, down 40% year over year.
Eaton’s backlog growth, with orders, increased 31%, 11% and 12% in Electrical Americas, Aerospace and Electric Global, respectively, on a rolling 12-month basis.
Financial Update
As of Mar 31, 2024, the company’s cash was $473 million, down from $488 million as of Dec 31, 2023.
As of Mar 31, 2024, ETN’s long-term debt was $8.2 billion, down 0.6% from $8.24 billion as of Dec 31, 2023.
Guidance
Eaton’s second-quarter 2024 earnings are expected in the range of $2.52-$2.62 per share. The Zacks Consensus Estimate is pegged at $2.55, lower than the mid-point of the company’s guidance. The company expects organic growth in the range of 6.5-8.5%.
Eaton now projects adjusted earnings per share in the range of $10.20-$10.60 for 2024, indicating an increase of 14% at the midpoint from the prior-year levels. The company raised its organic sales guidance for 2024 from 6.5-8.5% to 7-9%. Eaton also raised its segment margin guidance from 22.4-22.8% to 22.8-23.2%.
The company estimates its 2024 operating cash flow in the range of $4-$4.4 billion. Free cash flow is forecast in the range of $3.2-$3.6 billion.
Chart Industries, Inc (GTLS - Free Report) is scheduled to report first-quarter 2024 results on May 3. The Zacks Consensus Estimate for earnings is pegged at $1.88 per share, indicating an increase of 33.39% from the year-ago levels.
The long-term (three-to-five years) earnings growth rate is pinned at 30.4%. GTLS reported average earnings surprise of 75.8% in the last four reported quarter.
Ingersoll Rand Inc. (IR - Free Report) is scheduled to report first-quarter results on May 2. The Zacks Consensus Estimate for earnings is pegged at 69 cents per share, suggesting an increase of 6.2% from the prior-year levels.
The long-term earnings growth rate is pinned at 9.25%. IR reported average earnings surprise of 15.85% in the last four reported quarter.
The Manitowoc Company (MTW - Free Report) is scheduled to report first-quarter results on May 7, 2024. The Zacks Consensus Estimate for first-quarter earnings is pegged at 19 cents per share, indicating a decline of 58.7% from the year-ago actuals.
The Zacks Consensus Estimate for 2024 EPS is pegged at $1.31, implying a decline of 13.8% from the year-earlier levels. MTW reported average earnings surprise of 15.85% in the last four reported quarter.
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Eaton (ETN) Q1 Earnings Beat Estimates, 2024 View Raised
Eaton Corporation (ETN - Free Report) reported first-quarter 2024 earnings of $2.40 per share, which surpassed the Zacks Consensus Estimate by 5.3%. The bottom line increased 27.7% year over year and beat the earnings guidance of $2.21-$2.31 per share. The improvement was due to increased project activity tied to megatrends, reindustrialization and infrastructure spending.
GAAP earnings for the reported quarter were $2.04, up 28.3% from $1.59 reported in the year-ago quarter. The difference between GAAP and operating earnings for the reported quarter was due to charges of 21 cents for intangible assets amortization, 12 cents for a multi-year restructuring program and 3 cents for acquisitions and divestitures.
Revenues
Total quarterly revenues were $5.94 billion, which surpassed the Zacks Consensus Estimate of $5.9 billion by 0.7%. The first-quarter revenue growth was entirely driven by organic sales growth. Total revenues improved 8.4% year over year.
Eaton Corporation, PLC Price, Consensus and EPS Surprise
Eaton Corporation, PLC price-consensus-eps-surprise-chart | Eaton Corporation, PLC Quote
Segmental Details
Electrical Americas’ total first-quarter sales were $2.69 billion, up 17.3% year over year due to increased organic sales. Operating profit was $785 million, up 50% year over year.
Electrical Global’s total sales were $1.5 billion, on par with the year-ago quarter. Operating profit of $284 million flat year over year.
Aerospace’s total sales were $0.87 billion, up 9% year over year, driven by organic sales growth. Operating profit was $201 million, up 12% year over year.
Vehicle’s total sales were $0.72 billion, down 2% year over year due to a decline in organic sales, partially offset by positive currency translation. Operating profit was $116 million, up 8% year over year.
The eMobility segment’s total sales were $158 million, up 7% year over year, driven by organic sales growth. Operating loss in the quarter was $4 million, on par with the year-ago quarter’s loss.
Highlights of the Release
Selling and administrative expenses were $1.02 billion, up 13.4% year over year.
Research and development expenses were $189 million, up 5.6% year over year. Interest expenses were $30 million, down 40% year over year.
Eaton’s backlog growth, with orders, increased 31%, 11% and 12% in Electrical Americas, Aerospace and Electric Global, respectively, on a rolling 12-month basis.
Financial Update
As of Mar 31, 2024, the company’s cash was $473 million, down from $488 million as of Dec 31, 2023.
As of Mar 31, 2024, ETN’s long-term debt was $8.2 billion, down 0.6% from $8.24 billion as of Dec 31, 2023.
Guidance
Eaton’s second-quarter 2024 earnings are expected in the range of $2.52-$2.62 per share. The Zacks Consensus Estimate is pegged at $2.55, lower than the mid-point of the company’s guidance. The company expects organic growth in the range of 6.5-8.5%.
Eaton now projects adjusted earnings per share in the range of $10.20-$10.60 for 2024, indicating an increase of 14% at the midpoint from the prior-year levels. The company raised its organic sales guidance for 2024 from 6.5-8.5% to 7-9%. Eaton also raised its segment margin guidance from 22.4-22.8% to 22.8-23.2%.
The company estimates its 2024 operating cash flow in the range of $4-$4.4 billion. Free cash flow is forecast in the range of $3.2-$3.6 billion.
Zacks Rank
Currently, Eaton has a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Upcoming Releases
Chart Industries, Inc (GTLS - Free Report) is scheduled to report first-quarter 2024 results on May 3. The Zacks Consensus Estimate for earnings is pegged at $1.88 per share, indicating an increase of 33.39% from the year-ago levels.
The long-term (three-to-five years) earnings growth rate is pinned at 30.4%. GTLS reported average earnings surprise of 75.8% in the last four reported quarter.
Ingersoll Rand Inc. (IR - Free Report) is scheduled to report first-quarter results on May 2. The Zacks Consensus Estimate for earnings is pegged at 69 cents per share, suggesting an increase of 6.2% from the prior-year levels.
The long-term earnings growth rate is pinned at 9.25%. IR reported average earnings surprise of 15.85% in the last four reported quarter.
The Manitowoc Company (MTW - Free Report) is scheduled to report first-quarter results on May 7, 2024. The Zacks Consensus Estimate for first-quarter earnings is pegged at 19 cents per share, indicating a decline of 58.7% from the year-ago actuals.
The Zacks Consensus Estimate for 2024 EPS is pegged at $1.31, implying a decline of 13.8% from the year-earlier levels. MTW reported average earnings surprise of 15.85% in the last four reported quarter.