NYSE$ETN

Eaton Corp PLC · Q2 2021 earnings

Q2 2021 earnings · · Investor relations

Briefing

Eaton reported record adjusted EPS and segment margins, with organic sales slightly above guidance midpoint, despite supply chain constraints.

Eaton Corporation reported strong second-quarter results, with sales of $5.2 billion, up 35% from the second quarter of 2020. Adjusted earnings per share were a record $1.72, up 98% over the second quarter of 2020. The company is raising its adjusted earnings per share guidance for 2021 to $6.73 at the midpoint, up 37% over 2020, and raising full-year 2021 operating cash flow by $200 million above previous guidance at the midpoint.

  • Earnings per share were $1.26 for the second quarter of 2021.
  • Adjusted earnings per share were a second quarter record of $1.72, up 98% over the second quarter of 2020.
  • Sales in the second quarter of 2021 were $5.2 billion, up 35% from the second quarter of 2020.
  • Second quarter segment margins were 18.6%, up 390 basis points over the second quarter of 2020.

Headline financials

Total Revenue

$5.22B

Previous: $3.86B+35.2%
EPS (adj)

$1.72

Previous: $0.70+145.7%
Segment margins

18.6%

Previous: 14.7%+26.5%
Capital Expenditures

-$272M

Previous: -$202M-34.7%
Free Cash Flow

$234M

Previous: -$151M+255.0%
Net Income

$506M

Previous: $51M+892.2%
Operating Income

-$4.59B

Previous: -$3.88B-18.2%
Gross Profit

$1.67B

Previous: $979M+70.6%
Cash & Equivalents

$279M

Previous: $292M-4.5%
Total Assets

$36.8B

Previous: $30.3B+21.3%

Revenue & EPS history

Eaton · Revenue · Quarterly

$5.22B

Q2 2021+35.2%vs Q2 2020
Beat estimate in 13 of 16 quarters(81%)
ActualEstimate

Revenue by segment

Eaton · $4.66B total across 5 segments · Q2 2021

  • Electrical Americas
    $1.85B+24.1%
  • Electrical Global
    $1.42B+27.6%
  • Vehicle
    $675M+106.4%
  • Aerospace
    $625M+35.6%
  • eMobility
    $88M+57.1%

Forward guidance

Eaton anticipates adjusted earnings per share to be between $1.72 and $1.82 for the third quarter of 2021. The company expects 2021 adjusted earnings per share to be between $6.58 and $6.88. Additionally, Eaton expects 2021 full year adjusted operating cash flow to be between $2.6 billion and $2.8 billion.

Tailwinds

  • Anticipated higher organic sales for the remainder of the year
  • Raising Adjusted Earnings Per Share Guidance for 2021 to $6.73 at the Midpoint, Up 37% Over 2020
  • Raising Full Year 2021 Operating Cash Flow by $200 Million Above Previous Guidance at the Midpoint
  • Strong order growth in Electrical Global segment of 46% over the second quarter of 2020
  • Orders increased 43% over the second quarter of 2020 in Electrical Americas segment

Headwinds

  • Course of the COVID-19 pandemic globally and government actions related thereto
  • Unanticipated changes in the markets for the company’s business segments
  • Unanticipated downturns in business relationships with customers or their purchases from us
  • Competitive pressures on sales and pricing
  • Unanticipated changes in the cost of material and other production costs, or unexpected costs that cannot be recouped in product pricing

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 20 quarterly earnings reports · overlaid with Q2 2021

Historical avgQ2 2021

+0.8%

Avg return

Earnings day

+0.4%

Avg return

5 days after

+2.3%

Avg return

30 days after

62%

40 / 65 earnings

Positive

+10.9%

Q4 2015

Best reaction

-8.9%

Q2 2014

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q1 2026+0.0%-5.2%-1.3%
Q4 2025+0.6%+4.0%-1.3%
Q3 2025-2.3%-3.3%-12.3%
Q2 2025-7.4%-5.7%-9.5%
Q1 2025-0.8%+0.2%+6.1%
Q4 2024-0.2%-3.6%-10.3%
Q3 2024-2.3%-1.6%+9.5%
Q2 2024-8.0%-8.9%+0.7%
Q1 2024-4.4%-1.8%+2.4%
Q4 2023+9.8%+10.2%+19.4%
Q3 2023+8.6%+8.6%+15.1%
Q2 2023+6.6%+5.2%+12.2%
Q1 2023+2.1%+1.3%+6.1%
Q4 2022+1.7%+6.0%+3.5%
Q3 2022+0.4%+5.7%+8.9%
Q2 2022+0.8%+0.8%-5.9%
Q1 2022+2.3%+0.5%-3.9%
Q4 2021-4.3%+0.0%-4.5%
Q3 2021+3.1%+4.2%+1.4%
Q2 2021+3.4%+4.1%+7.4%
Q1 2021+0.8%+2.2%+1.4%
Q4 2020-1.6%+0.3%+10.6%
Q3 2020-1.3%+2.4%+8.7%
Q2 2020+1.2%+1.6%+10.9%
Q1 2020-4.3%-5.8%-1.0%
Q4 2019+7.2%-2.4%-0.3%
Q3 2019+1.2%+1.6%+6.6%
Q2 2019+1.4%-2.2%-1.8%
Q1 2019-2.5%-1.4%-9.7%
Q4 2018+4.9%+5.9%+10.1%
Q3 2018+0.9%+3.1%+7.0%
Q2 2018+3.1%+2.1%+3.7%
Q1 2018-2.9%-0.2%+2.1%
Q4 2017+1.3%-1.5%-5.1%
Q3 2017+2.9%-1.4%-1.8%
Q2 2017-5.3%-4.8%-8.3%
Q1 2017+0.3%+1.0%+2.6%
Q4 2016-1.5%-1.5%+0.9%
Q3 2016-4.5%-4.7%+6.1%
Q2 2016+0.5%+2.4%+4.7%
Q1 2016+0.4%
Q4 2015+10.9%
Q3 2015+4.4%
Q2 2015-0.7%
Q1 2015+0.2%
Q4 2014+6.3%
Q3 2014+3.1%
Q2 2014-8.9%
Q1 2014-2.5%
Q4 2013-1.7%
Q3 2013+3.0%
Q2 2013-5.1%
Q1 2012+4.4%
Q1 2013+4.7%
Q4 2010+1.6%
Q4 2011+1.6%
Q4 2012+5.4%
Q3 2012+9.9%
Q2 2012+5.0%
Q3 2011-7.2%
Q2 2011+5.0%
Q1 2011+2.0%
Q3 2010-0.2%
Q2 2010-2.2%
Q1 2010-0.5%

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