Goldman Sachs Reiterates Buy on Eaton

Goldman Sachs is out with its report today on Eaton ETN, maintaining Buy. In a note to clients, Goldman Sachs writes, "We reiterate our CL-Buy with 27% upside potential to target and believe the market continues to underestimate ETN's earnings revision potential. Shares are +4% ytd versus peers +7% despite a 13% increase in consensus FY2 EPS estimates versus +7% for peers, with ETN's FY2 PE down 9% versus flat for peers. With the stock now trading at a 15-20% discount to peers versus -12% at the beginning of 2011 and later cycle businesses becoming the dominant drivers of profit improvement in 2012+ (Electrical and Aero expected at about 45% of 2012 profit growth versus 28% in 2011), we believe ETN's valuation can expand relative to the group as well." Goldman Sachs maintains a $67 PT on ETN. At the time of posting, shares of ETN were trading pre-market at $52.99, up 0.76% from Monday's close.