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Eaton Corporation (ETN - Free Report) reported second-quarter 2024 earnings of $2.73 per share, which surpassed the Zacks Consensus Estimate by 4.6%. The bottom line increased 24% year over year and came ahead of the earnings guidance of $2.52-$2.62 per share. The improvement can be attributed to increased project activity tied to a multi-year restructuring program and the contribution of acquired assets.
GAAP earnings for the reported quarter were $2.48, up 33% from $1.86 in the year-ago quarter. The difference between GAAP and operating earnings in the reported quarter was due to charges of 20 cents for intangible assets amortization, 3 cents for a multi-year restructuring program and 2 cents for acquisitions and divestitures.
Revenues
Total quarterly revenues were $6.35 billion, which missed the Zacks Consensus Estimate of $6.351 billion by 0.01%. Total revenues increased 8.3% year over year. The second-quarter revenue growth was entirely driven by organic sales growth and partially offset by 1% from negative currency translation.
Eaton Corporation, PLC Price, Consensus and EPS Surprise
Electrical Americas’ total second-quarter sales were $2.87 billion, up 13.4% year over year, attributed to increased organic sales. Operating profit was $859 million, up 28% year over year.
Electrical Global’s total sales were $1.6 billion, up 2% from the year-ago quarter. Operating profit was $305 million, up 5% year over year.
Aerospace’s total sales were $0.95 billion, up 13% year over year, driven by organic sales growth. Operating profit was $206 million, up 21.5% year over year.
Vehicle’s total sales were $0.72 billion, down 4% year over year, due to a decline in organic sales and negative currency translation. Operating profit was $130 million, up 13% year over year.
The eMobility segment’s total sales were $189 million, up 18% year over year, driven by organic sales growth. Operating earnings were $2 million, up 1.3% year over year.
Highlights of the Release
Selling and administrative expenses were $1.02 billion, up 3.5% year over year.
Research and development expenses were $196 million, up 4.8% year over year. Interest expenses were $29 million, down 30.9% year over year.
Eaton’s backlog growth, with orders, increased 29%, 14% and 16% in Electrical Americas, Aerospace and Electric Global, respectively, on a rolling 12-month basis.
Financial Update
As of Jun 30, 2024, the company’s cash was $540 million, up from $488 million as of Dec 31, 2023.
As of Jun 30, 2024, ETN’s long-term debt was $8.55 billion, up 3.8% from $8.24 billion as of Dec 31, 2023.
Guidance
Eaton’s third-quarter 2024 earnings are expected in the range of $2.73-$2.83 per share. The Zacks Consensus Estimate is pegged at $2.77, a tad lower than the mid-point of the company’s guidance. The company expects organic growth in the range of 8-9%.
Eaton now projects adjusted earnings per share in the range of $10.65-$10.75 for 2024, indicating an increase of 17% at the midpoint from the prior-year levels. The company raised its organic sales guidance for 2024 from the range of 7-9% to the band of 8-9%. Eaton also raised its segment margin guidance from the range of 22.8-23.2% to the band of 23.3-23.7%.
The company raised its 2024 operating cash flow estimates to the range of $4.2-$4.4 billion from the prior range of $4-$4.4 billion. Free cash flow guidance is raised to a range of $3.4-$3.6 billion from an earlier range of $3.2-$3.6 billion.
Chart Industries, Inc (GTLS - Free Report) is scheduled to report second-quarter 2024 results on Aug 2. The Zacks Consensus Estimate for earnings is pegged at $2.57 per share, indicating an increase of 115.9% from the year-ago level. The long-term (three-to-five years) earnings growth rate of GTLS is pinned at 30.04%.
Emerson (EMR - Free Report) is scheduled to report fiscal third-quarter results on Aug 7. The Zacks Consensus Estimate for earnings is pegged at $1.42 per share, implying an increase of 10.08% from the prior-year level.
The long-term earnings growth rate is pinned at 10.71%. EMR delivered an average earnings surprise of 10.71% in each of the last four quarters.
The Manitowoc Company (MTW - Free Report) is scheduled to report second-quarter results on Aug 7, 2024. The Zacks Consensus Estimate for second-quarter earnings is pegged at 58 cents per share, indicating a decline of 22.7% from the year-ago actual.
The Zacks Consensus Estimate for 2024 EPS is pegged at $1.28, implying a decline of 15.8% from the year-earlier level. MTW delivered an average earnings surprise of 605.3% in each of the last four quarters.
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Eaton (ETN) Q2 Earnings Surpass Estimates, 2024 View Raised
Eaton Corporation (ETN - Free Report) reported second-quarter 2024 earnings of $2.73 per share, which surpassed the Zacks Consensus Estimate by 4.6%. The bottom line increased 24% year over year and came ahead of the earnings guidance of $2.52-$2.62 per share. The improvement can be attributed to increased project activity tied to a multi-year restructuring program and the contribution of acquired assets.
GAAP earnings for the reported quarter were $2.48, up 33% from $1.86 in the year-ago quarter. The difference between GAAP and operating earnings in the reported quarter was due to charges of 20 cents for intangible assets amortization, 3 cents for a multi-year restructuring program and 2 cents for acquisitions and divestitures.
Revenues
Total quarterly revenues were $6.35 billion, which missed the Zacks Consensus Estimate of $6.351 billion by 0.01%. Total revenues increased 8.3% year over year. The second-quarter revenue growth was entirely driven by organic sales growth and partially offset by 1% from negative currency translation.
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 second-quarter sales were $2.87 billion, up 13.4% year over year, attributed to increased organic sales. Operating profit was $859 million, up 28% year over year.
Electrical Global’s total sales were $1.6 billion, up 2% from the year-ago quarter. Operating profit was $305 million, up 5% year over year.
Aerospace’s total sales were $0.95 billion, up 13% year over year, driven by organic sales growth. Operating profit was $206 million, up 21.5% year over year.
Vehicle’s total sales were $0.72 billion, down 4% year over year, due to a decline in organic sales and negative currency translation. Operating profit was $130 million, up 13% year over year.
The eMobility segment’s total sales were $189 million, up 18% year over year, driven by organic sales growth. Operating earnings were $2 million, up 1.3% year over year.
Highlights of the Release
Selling and administrative expenses were $1.02 billion, up 3.5% year over year.
Research and development expenses were $196 million, up 4.8% year over year. Interest expenses were $29 million, down 30.9% year over year.
Eaton’s backlog growth, with orders, increased 29%, 14% and 16% in Electrical Americas, Aerospace and Electric Global, respectively, on a rolling 12-month basis.
Financial Update
As of Jun 30, 2024, the company’s cash was $540 million, up from $488 million as of Dec 31, 2023.
As of Jun 30, 2024, ETN’s long-term debt was $8.55 billion, up 3.8% from $8.24 billion as of Dec 31, 2023.
Guidance
Eaton’s third-quarter 2024 earnings are expected in the range of $2.73-$2.83 per share. The Zacks Consensus Estimate is pegged at $2.77, a tad lower than the mid-point of the company’s guidance. The company expects organic growth in the range of 8-9%.
Eaton now projects adjusted earnings per share in the range of $10.65-$10.75 for 2024, indicating an increase of 17% at the midpoint from the prior-year levels. The company raised its organic sales guidance for 2024 from the range of 7-9% to the band of 8-9%. Eaton also raised its segment margin guidance from the range of 22.8-23.2% to the band of 23.3-23.7%.
The company raised its 2024 operating cash flow estimates to the range of $4.2-$4.4 billion from the prior range of $4-$4.4 billion. Free cash flow guidance is raised to a range of $3.4-$3.6 billion from an earlier range of $3.2-$3.6 billion.
Zacks Rank
Currently, Eaton has a Zacks Rank #3 (Hold). 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 second-quarter 2024 results on Aug 2. The Zacks Consensus Estimate for earnings is pegged at $2.57 per share, indicating an increase of 115.9% from the year-ago level. The long-term (three-to-five years) earnings growth rate of GTLS is pinned at 30.04%.
Emerson (EMR - Free Report) is scheduled to report fiscal third-quarter results on Aug 7. The Zacks Consensus Estimate for earnings is pegged at $1.42 per share, implying an increase of 10.08% from the prior-year level.
The long-term earnings growth rate is pinned at 10.71%. EMR delivered an average earnings surprise of 10.71% in each of the last four quarters.
The Manitowoc Company (MTW - Free Report) is scheduled to report second-quarter results on Aug 7, 2024. The Zacks Consensus Estimate for second-quarter earnings is pegged at 58 cents per share, indicating a decline of 22.7% from the year-ago actual.
The Zacks Consensus Estimate for 2024 EPS is pegged at $1.28, implying a decline of 15.8% from the year-earlier level. MTW delivered an average earnings surprise of 605.3% in each of the last four quarters.