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Eaton (ETN) to Report Q2 Earnings: What's in the Cards?

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Eaton CorporationETN is expected to beat earnings estimates when it reports second-quarter 2018 financial results on Jul 31, before the opening bell. The power management company delivered a positive earnings surprise of 3.77% in the last reported quarter.

What Our Quantitative Model Predicts

Our proven model shows that Eaton Corporation is likely to beat estimates in the upcoming quarterly results. A stock needs to have both a positive Earnings ESP (which represents the difference between the Most Accurate Estimate and the Zacks Consensus Estimate) and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) to surpass estimates, and Eaton Corporation has the right mix. You can see the complete list of today's Zacks #1 Rank stocks here.

You can uncover the best stocks to buy or sell before they're reported with our Earnings ESP Filter .

Earnings ESP : Earnings ESP of the company is pegged at +0.67%. This is because the Most Accurate Estimate is $1.33, higher than the Zacks Consensus Estimate of $1.32.

Eaton Corporation, PLC Price and EPS Surprise

Eaton Corporation, PLC Price and EPS Surprise | Eaton Corporation, PLC Quote

Zacks Rank: Currently, Eaton Corporation carries a Zacks Rank #2. The combination of Eaton's favorable Zacks Rank and a positive ESP makes us reasonably confident of a positive earnings surprise.

Conversely, we caution against Sell-rated stocks (#4 or 5) going into the earnings announcement, especially when the company is seeing negative estimate revisions.

Factors to Consider

Eaton expects second-quarter earnings in the range of $1.25-$1.35 per share and organic revenues to expand 5%. The company continues to lower its outstanding shares through share repurchase, which is going to have a positive impact on earnings.

The company expects organic growth to accelerate in the second quarter due to rising backlog of industrial projects. The new eMobility segment is expected to have a positive impact on its earnings.

The Zacks Consensus Estimate for second-quarter total revenues of $5,466 million reflects growth of 6.5% year over year. Electric Products segment is a major contributor to Eaton's total revenues. The Zacks Consensus Estimate of $1,832 million for this segment's revenues projects an increase of 1.7% sequentially.

Stocks With Favorable Combination

Eaton is not the only company looking up this earnings season. Investors can also consider other companies from the same industry that have the right combination of elements to post an earnings beat in the to-be-reported quarter.

CUI Global Inc. CUI has an Earnings ESP of +11.11% and a Zacks Rank #3. It is expected to report second-quarter 2018 earnings on Aug 8.

Emerson Electric Co. EMR has an Earnings ESP of +0.15% and a Zacks Rank #3. It is slated to report third-quarter fiscal 2018 earnings on Aug 7.

Rexnord Corporation. RXN has an Earnings ESP of +3.74% and a Zacks Rank #3. It is anticipated to report first-quarter fiscal 2019 earnings on July 30.

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Emerson Electric Co. (EMR): Free Stock Analysis Report

CUI Global, Inc. (CUI): Free Stock Analysis Report

Rexnord Corporation (RXN): Free Stock Analysis Report

Eaton Corporation, PLC (ETN): Free Stock Analysis Report

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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