Eaton Corporation plc (ETN) Stock Valuation — PE Analysis
Electrical Equipment & Parts · NYSE
Current Price
$424.51
PE Ratio (TTM)
43.1x
Intrinsic Value
$475.62
+10.7% margin of safety
COMPETITIVE MOAT
↑Intelligent Power Management Expertise
Eaton's deep understanding of complex power systems and its integrated solutions create high switching costs for customers in critical infrastructure. This expertise is difficult for competitors to replicate quickly.
↑Data Center Infrastructure Demand
The accelerating demand for data centers, driven by AI and cloud computing, provides a strong tailwind for Eaton's power management and distribution products. This secular growth trend solidifies its market position.
↑Global Brand and Distribution Network
Eaton's established global brand recognition and extensive distribution channels provide a significant competitive advantage. This allows for broad market reach and efficient customer service.
INVESTMENT RISKS
↓Supply Chain Volatility
Global supply chain disruptions can impact raw material availability and manufacturing costs, affecting Eaton's production schedules and profitability. Geopolitical events and logistics challenges pose ongoing threats.
↓Regulatory and Environmental Policy Shifts
Changes in environmental regulations and energy policies could necessitate significant product redesigns or investments, impacting Eaton's operational costs and market strategy. Compliance with evolving standards is crucial.
↓Economic Downturns Affecting Capital Expenditures
A significant economic slowdown could lead to reduced capital spending by businesses and governments, impacting demand for Eaton's electrical equipment and infrastructure solutions. Consumer and industrial confidence are key indicators.
Base case
ETN base case PE valuation
At a current price of $424.51, the base case PE valuation puts ETN fair value near $475.62 per share. That figure assumes 10.1% yearly earnings growth, a target PE multiple of 43.05x, and a 10% discount rate.
Intrinsic Value
$475.62
Margin of safety
+10.7%
Expected annual return
+2.3%
Base case assumptions: 10.1% annual earnings growth, 43.05x target PE, 10% discount rate, 5 year projection. Data as of 2026-10-08.
This base case uses default assumptions and is not financial advice. The fair value changes significantly when the target PE or earnings growth rate changes. Open the calculator to set your own assumptions and see the full sensitivity range.
Customize the ETN PE valuation
Adjust the target PE, earnings growth, and discount rate to see how the fair value and margin of safety for Eaton Corporation plc respond.
Open PE Calculator for ETNCompany Overview
Eaton Corp. Plc is a power management company, which provides energy-efficient solutions for electrical, hydraulic, and mechanical power. It operates through the following segments: Electrical Americas and Electrical Global; Aerospace, Vehicle, and eMobility. The Electrical Americas and Electrical Global segments engage in sales contracts for electrical components, industrial components, power distribution and assemblies, residential products, single and three phase power quality, wiring devices, circuit protection, utility power distribution, power reliability equipment, and service. The Aerospace segment supplies aerospace fuel, hydraulics, and pneumatic systems for commercial and military use. The Vehicle segment deals with the design, manufacture, marketing, and supply of drivetrain and powertrain systems and critical components that reduce emissions and improve fuel economy, stability, performance and safety of cars, light trucks and commercial vehicles. The eMobility segment designs, manufactures, markets, and supplies electrical and electronic components and systems that improve the power management and performance of both on-road and off-road vehicles. The company was founded in 1911 and is headquartered in Dublin, Ireland.
Financial Metrics — ETN PE Stock Valuation Data
PE Ratio (TTM)
43.1x
PEG Ratio
n/m
Earnings Yield
2.32%
ROE (TTM)
19.6%
Revenue/Share (TTM)
$77.28
Dividend Yield
1.02%
Debt/Equity
1.05x
Frequently Asked Questions
What is the PE ratio of ETN?
The trailing twelve-month PE ratio of ETN reflects how much investors pay per dollar of Eaton Corporation plc's earnings. This metric is most useful when compared to Electrical Equipment & Parts peers and the company's own historical range.
Is ETN overvalued based on PE ratio?
ETN's PE of 43.1x combined with a PEG ratio of -39.02 provides a growth-adjusted perspective. ETN has negative earnings, so its PE and PEG ratios are not meaningful here and cannot tell you whether the stock is over or undervalued. Keep in mind that PE-based valuation works best for profitable, mature companies — for high-growth or cyclical Electrical Equipment & Parts, a DCF analysis may be more appropriate.
How do I value ETN stock using PE ratio?
To value Eaton Corporation plc using PE: (1) Compare the current PE (43.1x) against the Electrical Equipment & Parts median to assess relative pricing, (2) check the PEG ratio (-39.02) to adjust for growth expectations, (3) review the 5-year PE range to identify where the stock sits historically, and (4) estimate fair value by multiplying a target PE by forward EPS estimates. This relative approach complements DCF's absolute valuation.
What is the PEG ratio of ETN?
ETN's PEG ratio is -39.02, calculated by dividing the PE ratio (43.1x) by the expected earnings growth rate. Because ETN has negative earnings, its PEG ratio is not meaningful and should not be read as a sign of under or overvaluation. Note that PEG accuracy depends on the reliability of growth estimates.
Should I use PE ratio or DCF for ETN stock valuation?
PE ratio gives a quick relative read — how ETN is priced versus Electrical Equipment & Parts peers. DCF provides an absolute value based on projected free cash flows. For ETN, with a strong ROE of 19.6%, both methods are worth using — PE for a market-relative check, DCF to stress-test whether fundamentals justify the price. Each method has blind spots: PE ignores capital structure and cash flow quality, while DCF is sensitive to growth and discount rate assumptions.
Learn More
- See ETN DCF Valuation → — Intrinsic value via Discounted Cash Flow analysis
- PE Methodology — Step-by-step guide to PE ratio stock valuation
- DCF Methodology — Guide to discounted cash flow analysis
- PE Ratio — Understanding the price-to-earnings ratio
- Intrinsic Value — How to evaluate stock fair value
Related PE Valuations
All Industrials valuationsP/E and DCF value ETN with different methods and assumptions, so the two conclusions can differ. Compare the DCF intrinsic value.
Price as of 2026-10-08. Financial data from Financial Modeling Prep (trailing twelve months) · Valuation methodology by Charlie Wang.
This is an estimate, not investment advice.