Eaton PLC Return On Equity vs. Current Valuation
| ETN Stock | USD 377.41 6.46 1.74% |
Return On Equity | First Reported 2010-12-31 | Previous Quarter 0.16904812 | Current Value 0.17 | Quarterly Volatility 0.02998716 |
| Current Value | Last Year | Change From Last Year | 10 Year Trend | ||||||
|---|---|---|---|---|---|---|---|---|---|
| Gross Profit Margin | 0.24 | 0.3636 |
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| Net Profit Margin | 0.15 | 0.1387 |
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| Operating Profit Margin | 0.07 | 0.0901 |
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| Pretax Profit Margin | 0.17 | 0.165 |
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| Return On Assets | 0.0474 | 0.0837 |
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| Return On Equity | 0.17 | 0.169 |
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For Eaton PLC profitability analysis, we use financial ratios and fundamental drivers that measure the ability of Eaton PLC to generate income relative to revenue, assets, operating costs, and current equity. These fundamental indicators attest to how well Eaton PLC utilizes its assets to generate profit and value for its shareholders. The profitability module also shows relationships between Eaton PLC's most relevant fundamental drivers. It provides multiple suggestions of what could affect the performance of Eaton PLC over time as well as its relative position and ranking within its peers.
Eaton |
Eaton PLC's Revenue Breakdown by Earning Segment
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Is Electrical Components & Equipment space expected to grow? Or is there an opportunity to expand the business' product line in the future? Factors like these will boost the valuation of Eaton PLC. If investors know Eaton will grow in the future, the company's valuation will be higher. The financial industry is built on trying to define current growth potential and future valuation accurately. All the valuation information about Eaton PLC listed above have to be considered, but the key to understanding future value is determining which factors weigh more heavily than others.
Quarterly Earnings Growth 0.14 | Dividend Share 3.68 | Earnings Share 9.4 | Revenue Per Share 61.686 | Quarterly Revenue Growth 0.079 |
The market value of Eaton PLC is measured differently than its book value, which is the value of Eaton that is recorded on the company's balance sheet. Investors also form their own opinion of Eaton PLC's value that differs from its market value or its book value, called intrinsic value, which is Eaton PLC's true underlying value. Investors use various methods to calculate intrinsic value and buy a stock when its market value falls below its intrinsic value. Because Eaton PLC's market value can be influenced by many factors that don't directly affect Eaton PLC's underlying business (such as a pandemic or basic market pessimism), market value can vary widely from intrinsic value.
Please note, there is a significant difference between Eaton PLC's value and its price as these two are different measures arrived at by different means. Investors typically determine if Eaton PLC is a good investment by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, Eaton PLC's price is the amount at which it trades on the open market and represents the number that a seller and buyer find agreeable to each party.
Eaton PLC Current Valuation vs. Return On Equity Fundamental Analysis
Comparative valuation techniques use various fundamental indicators to help in determining Eaton PLC's current stock value. Our valuation model uses many indicators to compare Eaton PLC value to that of its competitors to determine the firm's financial worth. Eaton PLC is rated below average in return on equity category among its peers. It is rated as one of the top companies in current valuation category among its peers reporting about 783,040,000,000 of Current Valuation per Return On Equity. At this time, Eaton PLC's Return On Equity is very stable compared to the past year. The reason why the comparable model can be used in almost all circumstances is due to the vast number of multiples that can be utilized, such as the price-to-earnings (P/E), price-to-book (P/B), price-to-sales (P/S), price-to-cash flow (P/CF), and many others. The P/E ratio is the most commonly used of these ratios because it focuses on the Eaton PLC's earnings, one of the primary drivers of an investment's value.Eaton Current Valuation vs. Return On Equity
Return on Equity or ROE tells company stockholders how effectually their money is being utilized or reinvested. It is a useful ratio when analyzing company profitability or the management effectiveness given the capital invested by the shareholders. ROE shows how efficiently a company utilizes investments to generate income.
Eaton PLC |
| = | 0.2 |
For most industries, Return on Equity between 10% and 30% are considered desirable to provide dividends to owners and have funds for the future growth of the company. Investors should be very careful using ROE as the only efficiency indicator because ROE can be high if a company is heavily leveraged.
Enterprise Value is a firm valuation proxy that approximates the current market value of a company. It is typically used to determine the takeover or merger price of a firm. Unlike Market Cap, this measure takes into account the entire liquid asset, outstanding debt, and exotic equity instruments that the company has on its balance sheet. When a takeover occurs, the parent company will have to assume the target company's liabilities but will take possession of all cash and cash equivalents.
Eaton PLC |
| = | 157.23 B |
Enterprise Value can be a useful tool to compare companies with different capital structures. Long term liability and current cash or cash equivalents can have a huge impact on market valuation of a given company.
Eaton Current Valuation vs Competition
Eaton PLC is rated as one of the top companies in current valuation category among its peers. After adjusting for long-term liabilities, total market size of Industrials industry is currently estimated at about 418.24 Billion. Eaton PLC totals roughly 157.23 Billion in current valuation claiming about 38% of equities under Industrials industry.
Eaton PLC Profitability Projections
The most important aspect of a successful company is its ability to generate a profit. For investors in Eaton PLC, profitability is also one of the essential criteria for including it into their portfolios because, without profit, Eaton PLC will eventually generate negative long term returns. The profitability progress is the general direction of Eaton PLC's change in net profit over the period of time. It can combine multiple indicators of Eaton PLC, where stable trends show no significant progress. An accelerating trend is seen as positive, while a decreasing one is unfavorable. A rising trend means that profits are rising, and operational efficiency may be rising as well. A decreasing trend is a sign of poor performance and may indicate upcoming losses.
| Last Reported | Projected for Next Year | ||
| Accumulated Other Comprehensive Income | -3.9 B | -3.7 B | |
| Operating Income | 3.8 B | 4 B | |
| Income Before Tax | 3.8 B | 4 B | |
| Total Other Income Expense Net | 5 M | 4.8 M | |
| Net Income | 3.2 B | 3.4 B | |
| Income Tax Expense | 604 M | 634.2 M | |
| Net Income Applicable To Common Shares | 2.8 B | 1.5 B | |
| Net Income From Continuing Ops | 3 B | 2.4 B | |
| Non Operating Income Net Other | 69 M | 65.5 M | |
| Interest Income | 129.6 M | 164.5 M | |
| Net Interest Income | -168 M | -176.4 M | |
| Change To Netincome | -171 M | -179.6 M | |
| Net Income Per Share | 8.06 | 8.47 | |
| Income Quality | 1.13 | 1.83 | |
| Net Income Per E B T | 0.84 | 0.62 |
Eaton Profitability Driver Comparison
Profitability drivers are factors that can directly affect your investment outlook on Eaton PLC. Investors often realize that things won't turn out the way they predict. There are maybe way too many unforeseen events and contingencies during the holding period of Eaton PLC position where the market behavior may be hard to predict, tax policy changes, gold or oil price hikes, calamities change, and many others. The question is, are you prepared for these unexpected events? Although some of these situations are obviously beyond your control, you can still follow the important profit indicators to know where you should focus on when things like this occur. Below are some of the Eaton PLC's important profitability drivers and their relationship over time.
Use Eaton PLC in pair-trading
One of the main advantages of trading using pair correlations is that every trade hedges away some risk. Because there are two separate transactions required, even if Eaton PLC position performs unexpectedly, the other equity can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Eaton PLC will appreciate offsetting losses from the drop in the long position's value.Eaton PLC Pair Trading
Eaton PLC Pair Trading Analysis
The ability to find closely correlated positions to Eaton PLC could be a great tool in your tax-loss harvesting strategies, allowing investors a quick way to find a similar-enough asset to replace Eaton PLC when you sell it. If you don't do this, your portfolio allocation will be skewed against your target asset allocation. So, investors can't just sell and buy back Eaton PLC - that would be a violation of the tax code under the "wash sale" rule, and this is why you need to find a similar enough asset and use the proceeds from selling Eaton PLC to buy it.
The correlation of Eaton PLC is a statistical measure of how it moves in relation to other instruments. This measure is expressed in what is known as the correlation coefficient, which ranges between -1 and +1. A perfect positive correlation (i.e., a correlation coefficient of +1) implies that as Eaton PLC moves, either up or down, the other security will move in the same direction. Alternatively, perfect negative correlation means that if Eaton PLC moves in either direction, the perfectly negatively correlated security will move in the opposite direction. If the correlation is 0, the equities are not correlated; they are entirely random. A correlation greater than 0.8 is generally described as strong, whereas a correlation less than 0.5 is generally considered weak.
Correlation analysis and pair trading evaluation for Eaton PLC can also be used as hedging techniques within a particular sector or industry or even over random equities to generate a better risk-adjusted return on your portfolios.Use Investing Themes to Complement your Eaton PLC position
In addition to having Eaton PLC in your portfolios, you can quickly add positions using our predefined set of ideas and optimize them against your very unique investing style. A single investing idea is a collection of funds, stocks, ETFs, or cryptocurrencies that are programmatically selected from a pull of investment themes. After you determine your investment opportunity, you can then find an optimal portfolio that will maximize potential returns on the chosen idea or minimize its exposure to market volatility.Did You Try This Idea?
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Defense
Fama and French investing themes focus on testing asset pricing under different economic assumptions. The Defense theme has 16 constituents at this time.
You can either use a buy-and-hold strategy to lock in the entire theme or actively trade it to take advantage of the short-term price volatility of individual constituents. Macroaxis can help you discover thousands of investment opportunities in different asset classes. In addition, you can partner with us for reliable portfolio optimization as you plan to utilize Defense Theme or any other thematic opportunities.
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Check out Investing Opportunities. To learn how to invest in Eaton Stock, please use our How to Invest in Eaton PLC guide.You can also try the Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
To fully project Eaton PLC's future profitability, investors should examine all historical financial statements. These statements provide investors with a comprehensive snapshot of the financial position of Eaton PLC at a specified time, usually calculated after every quarter, six months, or one year. Three primary documents fall into the category of financial statements. These documents include Eaton PLC's income statement, its balance sheet, and the statement of cash flows.