Eaton Earnings Preview


Eaton ETN unveils its next round of earnings this Tuesday, February 02. Here is Benzinga's everything-that-matters guide for the earnings announcement.

What Are Earnings, Net Income, And Earnings Per Share?

Earnings and especially earnings per share (EPS) are useful measures of a company's profitability. Total earnings, which is also referred to as net income, equals total revenue minus total expenses. EPS equals to net income divided by the number of shares outstanding.

Earnings And Revenue

Analysts predict Eaton will report earnings of $1.2 per share on revenue of $4.62 billion. In the same quarter last year, Eaton reported earnings per share of $1.37 on revenue of $5.24 billion.


What Are Analyst Estimates And Earnings Surprises, And Why Do They Matter?

Analysts who cover this company will publish forward-looking estimates of its revenue and EPS each quarter. Averaging together every EPS and revenue prediction that each analyst makes about a company in a quarter yields the "consensus estimates." A company posting earnings or revenue above or below the consensus estimate is known as an "earnings surprise" and may move the stock by a considerable margin.

The analyst consensus estimate would represent a 12.41% decrease in the company's earnings. Sales would be down 11.8% from the year-ago period. In comparison to analyst estimates in the past, here is how the company's reported EPS stacks up:

Quarter Q3 2020 Q2 2020 Q1 2020 Q4 2020
EPS Estimate 1.04 0.53 1.07 1.40
EPS Actual 1.18 0.70 1.09 1.37
Revenue Estimate 4.21 B 3.69 B 4.79 B 5.34 B
Revenue Actual 4.53 B 3.86 B 4.79 B 5.24 B

Stock Performance

For a full 12 months, the return has risen by 18.33%. Given that these returns are generally positive, long-term shareholders are probably relaxed going into this earnings release. Long-term shareholders are already enjoying 12-month gains prior to the announcement.

Do not be surprised to see the stock move on comments made during its conference call. Eaton is scheduled to hold the call at 11:00:00 ET and can be accessed here.

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