Eaton Corporation (ETN - Free Report) reported first-quarter 2022 earnings of $1.62 per share, which surpassed the Zacks Consensus Estimate of $1.6 by 1.3%. Furthermore, earnings were up 12.5% year over year. First-quarter earnings were near the higher end of the guided range of $1.55-$1.65 per share.
GAAP earnings for the reported quarter were $1.33 per share compared with $1.14 in the year-ago period. The difference between GAAP and operating earnings for the reported quarter was due to charges of 25 cents associated with intangible amortization, 3 cents related to a multi-year restructuring program, and a cent pertaining to acquisitions and divestitures.
Revenues
Total quarterly revenues came in at $4,843 million, which surpassed the Zacks Consensus Estimate of $4,813 million by 0.6%. Total revenues improved 3.2% from the year-ago quarter.
The year-over-year improvement was due to 10% growth in organic sales and 6% growth from acquisitions, offset by a 1% negative currency translation and a 12% decline stemming from the Hydraulics business divestiture.
Segment Details
Electrical Americas’ total first-quarter sales were $1,891 million, up 16.6% from the year-ago level. This improvement was due to improved organic sales and contribution from the acquisition of Tripp Lite. Operating profits were $361 million, up 8.7% year over year.
Electrical Global’s total sales were $1,437 million, up 14.7% from the year-ago quarter. Organic sales were up 18% from the year-ago quarter, offset by a negative currency translation of 3%. Operating profits were $279 million, up 31% year over year.
Aerospace’s total sales were $718 million, up 38.4% from the year-ago quarter. This was due to improved organic sales and contribution from the acquisition of Mission Systems, marginally offset by negative currency translation. Operating profits were $159 million, up 65.6% year over year.
Vehicle total sales were $671 million, up 2.6% from the year-ago quarter due an increase in organic sales. Operating profits were $113 million, on par with the year-ago quarter.
eMobility segment’s total sales were $126 million, up 51.8% year over year due to an improvement in organic sales and acquisition of Royal Power Solutions.
Highlights of the Release
Selling and administrative expenses were $790 million, down 0.6% from the year-ago quarter.
ETN’s first-quarter research and development expenses were $165 million, up 11.5% from the prior-year period. Interest expenses for the quarter were $32 million, down 15.8% from the year-ago period.
Eaton’s Electrical segment backlog was up 76% and rolling 12-month orders up 30%, while Aerospace backlog was up 14% with rolling 12-month orders up 35%, all on an organic basis.
Financial Update
Eaton’s cash was $237 million as of Mar 31, 2022 compared with $297 million on Dec 31, 2021.
As of Mar 31, 2022, the company’s long-term debt was $6,763 million, down from $6,831 million on Dec 31, 2021.
Guidance
Eaton’s second-quarter 2022 earnings are expected in the range of $1.78-$1.88 per share. ETN now expects organic revenue growth in the range of 9-11% for the second quarter.
Eaton revised 2022 earnings per share in the range of $7.32-$7.72 from the previous guidance in the range of $7.30-$7.70. ETN now expects organic revenue growth in the range of 9-11% for 2022. Segment operating margin for 2022 is now expected in the range of 19.9-20.3%.
Eaton is targeting share buyback in the range of $200-$300 million in 2022.
Zacks Rank
Currently, Eaton has a Zacks Rank #4 (Sell).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Other Releases
A.O. Smith Corporation (AOS - Free Report) came up with first-quarter 2022 quarterly earnings of 77 cents per share, which beat the Zacks Consensus Estimate of 75 cents by nearly 2.8%.
A.O. Smith’s long-term (three to five years) earnings growth is pegged at 9%. The Zacks Consensus Estimate for AOS’ 2022 earnings per share indicates 19.3% year-over-year growth.
AZZ Inc. (AZZ - Free Report) reported fourth-quarter fiscal 2022 quarterly earnings of 86 cents per share, which beat the Zacks Consensus Estimate of 68 cents by 26.5%.
AZZ reported an average earnings surprise of 22.3% in the last four quarters. The Zacks Consensus Estimate for AZZ’s fiscal 2023 earnings per share indicates 14.7% year-over-year growth.
Regal Rexnord Corporation (RRX - Free Report) came up with first-quarter 2022 quarterly earnings of $2.68 per share, which beat the Regal Rexnord Zacks Consensus Estimate of $2.44 by 9.8%.
Regal Rexnord’s long-term (three to five years) earnings growth is pegged at 10%. The Zacks Consensus Estimate for RRX’s 2022 earnings per share indicates 11.7% year-over-year growth.
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Eaton Corporation (ETN - Free Report) reported first-quarter 2022 earnings of $1.62 per share, which surpassed the Zacks Consensus Estimate of $1.6 by 1.3%. Furthermore, earnings were up 12.5% year over year. First-quarter earnings were near the higher end of the guided range of $1.55-$1.65 per share.
GAAP earnings for the reported quarter were $1.33 per share compared with $1.14 in the year-ago period. The difference between GAAP and operating earnings for the reported quarter was due to charges of 25 cents associated with intangible amortization, 3 cents related to a multi-year restructuring program, and a cent pertaining to acquisitions and divestitures.
Revenues
Total quarterly revenues came in at $4,843 million, which surpassed the Zacks Consensus Estimate of $4,813 million by 0.6%. Total revenues improved 3.2% from the year-ago quarter.
The year-over-year improvement was due to 10% growth in organic sales and 6% growth from acquisitions, offset by a 1% negative currency translation and a 12% decline stemming from the Hydraulics business divestiture.
Segment Details
Electrical Americas’ total first-quarter sales were $1,891 million, up 16.6% from the year-ago level. This improvement was due to improved organic sales and contribution from the acquisition of Tripp Lite. Operating profits were $361 million, up 8.7% year over year.
Electrical Global’s total sales were $1,437 million, up 14.7% from the year-ago quarter. Organic sales were up 18% from the year-ago quarter, offset by a negative currency translation of 3%. Operating profits were $279 million, up 31% year over year.
Aerospace’s total sales were $718 million, up 38.4% from the year-ago quarter. This was due to improved organic sales and contribution from the acquisition of Mission Systems, marginally offset by negative currency translation. Operating profits were $159 million, up 65.6% year over year.
Vehicle total sales were $671 million, up 2.6% from the year-ago quarter due an increase in organic sales. Operating profits were $113 million, on par with the year-ago quarter.
eMobility segment’s total sales were $126 million, up 51.8% year over year due to an improvement in organic sales and acquisition of Royal Power Solutions.
Highlights of the Release
Selling and administrative expenses were $790 million, down 0.6% from the year-ago quarter.
ETN’s first-quarter research and development expenses were $165 million, up 11.5% from the prior-year period. Interest expenses for the quarter were $32 million, down 15.8% from the year-ago period.
Eaton’s Electrical segment backlog was up 76% and rolling 12-month orders up 30%, while Aerospace backlog was up 14% with rolling 12-month orders up 35%, all on an organic basis.
Financial Update
Eaton’s cash was $237 million as of Mar 31, 2022 compared with $297 million on Dec 31, 2021.
As of Mar 31, 2022, the company’s long-term debt was $6,763 million, down from $6,831 million on Dec 31, 2021.
Guidance
Eaton’s second-quarter 2022 earnings are expected in the range of $1.78-$1.88 per share. ETN now expects organic revenue growth in the range of 9-11% for the second quarter.
Eaton revised 2022 earnings per share in the range of $7.32-$7.72 from the previous guidance in the range of $7.30-$7.70. ETN now expects organic revenue growth in the range of 9-11% for 2022. Segment operating margin for 2022 is now expected in the range of 19.9-20.3%.
Eaton is targeting share buyback in the range of $200-$300 million in 2022.
Zacks Rank
Currently, Eaton has a Zacks Rank #4 (Sell).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Other Releases
A.O. Smith Corporation (AOS - Free Report) came up with first-quarter 2022 quarterly earnings of 77 cents per share, which beat the Zacks Consensus Estimate of 75 cents by nearly 2.8%.
A.O. Smith’s long-term (three to five years) earnings growth is pegged at 9%. The Zacks Consensus Estimate for AOS’ 2022 earnings per share indicates 19.3% year-over-year growth.
AZZ Inc. (AZZ - Free Report) reported fourth-quarter fiscal 2022 quarterly earnings of 86 cents per share, which beat the Zacks Consensus Estimate of 68 cents by 26.5%.
AZZ reported an average earnings surprise of 22.3% in the last four quarters. The Zacks Consensus Estimate for AZZ’s fiscal 2023 earnings per share indicates 14.7% year-over-year growth.
Regal Rexnord Corporation (RRX - Free Report) came up with first-quarter 2022 quarterly earnings of $2.68 per share, which beat the Regal Rexnord Zacks Consensus Estimate of $2.44 by 9.8%.
Regal Rexnord’s long-term (three to five years) earnings growth is pegged at 10%. The Zacks Consensus Estimate for RRX’s 2022 earnings per share indicates 11.7% year-over-year growth.
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
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