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Eaton Corporation ETN is expected to report an improvement in its top and bottom lines when it reports first-quarter 2025 results on May 2, before market open. (See the Zacks Earnings Calendar to stay ahead of market-making news)
The Zacks Consensus Estimate for ETN’s first-quarter revenues is pegged at $6.27 billion, indicating a 5.4% increase from the year-ago reported figure.
The consensus estimate for earnings is pegged at $2.7 per share. The Zacks Consensus Estimate for ETN’s first-quarter earnings indicates year-over-year growth of 12.5%.
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Eaton’s Solid Earnings Surprise History
Eaton’s earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, the average surprise being 3%.
Image Source: Zacks Investment Research
What the Zacks Model Unveils
Our proven model predicts a likely earnings beat for Eaton this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. That is the case here, as you can see below.
Eaton Corporation, PLC Price and EPS Surprise
Eaton Corporation, PLC price-eps-surprise | Eaton Corporation, PLC Quote
You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.
Earnings ESP: Eaton has an Earnings ESP of +1.41%.
Zacks Rank: Eaton currently carries a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.
Other stocks in the same sector that possess these two factors and are likely to come out with earnings surprise this season are Emerson Electric Co. EMR, Illinois Tool Works Inc. ITW and Lincoln Electric Holdings, Inc. LECO are currently having Earnings ESP of +1.96%, +0.15% and +0.81%, respectively. EMR, ITW and LECO currently have a Zacks Rank of 3.
Factors Likely to Have Driven ETN’s Q1 Earnings Performance
Eaton’s consistent investment in research and development enhances the quality of its existing products and assist in the creation of new offerings for its customers. This continuous innovation helps ETN secure additional orders and expand its market presence, contributing to higher earnings. For the first quarter, ETN anticipates organic revenue growth of 5.5-7.5%.
Electrification, major megatrends, the energy transition, and reindustrialization are driving growth across nearly 75% of ETN’s end markets, likely contributing to its first-quarter earnings performance. Meanwhile, the rapid expansion of artificial intelligence-based data centers is generating strong demand. These new facilities require substantial power and advanced energy management solutions, creating fresh opportunities for Eaton and likely providing an additional boost to its first-quarter earnings.
Eaton’s ability to win orders, courtesy of its wide product offering, is steadily boosting its backlog. The backlog provides a predictable stream of future revenues, and Eaton continues to benefit from its bulging backlog.
Eaton’s capability to address critical power management needs has driven organic growth across most of its segments and is likely supporting its earnings performance. Eaton provides the most extensive range of efficient electric solutions for Commercial & Institutional buildings, which continues to make a steady contribution to the company’s earnings every quarter.
The ongoing repurchase of shares, through free cash flow, is also likely to have had a positive impact on the first-quarter earnings of the company.