Monday, February 9, 2015

Seeking Alpha: Realistic Expectations And Improving Performance At Eaton

Based on fourth quarter results, I would argue that Eaton (NYSE:ETN) belongs on that list of diversified industrials that are doing pretty well given the circumstances (a list that includes 3M (NYSE:MMM), Honeywell (NYSE:HON), and arguably Parker-Hannifin (NYSE:PH)). The company's exposure to off-road vehicles and oil/gas will be liabilities in 2015, but exposure to aerospace and vehicles should offset it and Eaton's leverage to construction should also be a net positive.

I don't expect to find large, well-covered stocks like Eaton trading at major discounts to fair value and I don't believe that is the case here. That said, I like Eaton's prospects for "self-help" through margin leverage and asset leverage and I think these shares are slightly undervalued today.

Follow this link for the full article:
Realistic Expectations And Improving Performance At Eaton

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