Back to top

Image: Bigstock

Eaton (ETN) to Buy 50% of Jiangsu YiNeng's Busway Business

Read MoreHide Full Article

Eaton (ETN - Free Report) has entered into a definite agreement to acquire a 50% interest in Jiangsu YiNeng Electric’s busway business, which manufactures and sells busway products in China. This acquisition will expand Eaton’s power distribution portfolio in Asia Pacific. This busway business generated sales of $60 million in 2020.

Subject to regulatory approval, this deal is expected to close in the third quarter of 2021. After the closure of the deal, the company will do business as Eaton Busway Jiangsu. Busway is an electrical power supply distribution system that aids in seamless supply of power from one end of the building to the other end.

How This Acquisition Aid Eaton

Jiangsu YiNeng’s presence in China and access to Southeast Asia markets will allow Eaton to capitalize on the high-growth busway product category and strengthen its offerings to customers in the region. Jiangsu YiNeng serves clients in data center, infrastructure, commercial building, telecommunications, and industrial segments.

Due to seamless transfer of power in buildings on account of busway products, demand for such products is expected to increase globally, with the Asia-Pacific region being a major contributor toward the same. Eaton will leverage its existing global presence and the acquisition of a 50% interest in Jiangsu YiNeng Electric’s busway business as well as capitalize on the rising demand for busway products. ABB Ltd , among others, is also poised to benefit from the surge in busway products.

Eaton’s strategic acquisitions allow it to foray into new markets and enhance revenue stream. Acquisitions made by the company contributed 2% to total fourth-quarter revenues. Last month, it acquired Tripp Lite to expand its Power Quality Business in the Americas.

Price Performance

In the past six months, shares of Eaton have gained 36% compared with the industry’s 35.2% rally.

Zacks Rank & Key Picks

Eaton currently has a Zacks Rank #3 (Hold). Some better-ranked stocks in the same industry include AZZ Inc. (AZZ - Free Report) and ESCO Technologies Inc. (ESE - Free Report) , each currently having a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

AZZ and ESCO Technologies’ current dividend yield is 1.3% and 0.3%, respectively.

The Zacks Consensus Estimate for fiscal 2022 earnings per share of AZZ has moved up 5.7% in the past 60 days. In the same time frame, fiscal 2021 earnings per share of ESCO Technologies have moved up 0.4%.

Time to Invest in Legal Marijuana

If you’re looking for big gains, there couldn’t be a better time to get in on a young industry primed to skyrocket from $17.7 billion back in 2019 to an expected $73.6 billion by 2027.

After a clean sweep of 6 election referendums in 5 states, pot is now legal in 36 states plus D.C. Federal legalization is expected soon and that could be a still greater bonanza for investors. Even before the latest wave of legalization, Zacks Investment Research has recommended pot stocks that have shot up as high as +285.9%

You’re invited to check out Zacks’ Marijuana Moneymakers: An Investor’s Guide. It features a timely Watch List of pot stocks and ETFs with exceptional growth potential.

Today, Download Marijuana Moneymakers FREE >>


See More Zacks Research for These Tickers


Normally $25 each - click below to receive one report FREE:


Eaton Corporation, PLC (ETN) - free report >>

ESCO Technologies Inc. (ESE) - free report >>

AZZ Inc. (AZZ) - free report >>

Published in