Why Eaton Corporation Shares Are Moving After Q2 Results

Eaton Corporation PLC ETN shares are trading lower by 2.9% to $295.98 during Thursday’s session after the company reported second-quarter financial results.

What Happened: For the second quarter of 2024, Eaton reported an adjusted EPS of $2.73, which exceeded the estimated $2.61. The company's sales for the quarter were $6.4 billion, surpassing the $6.341 billion estimate.

Eaton projected its third-quarter 2024 adjusted EPS to be between $2.73 and $2.83, compared to the $2.74 estimate. Additionally, Eaton has forecasted its full-year 2024 adjusted EPS to range from $10.65 to $10.75, surpassing the $10.53 estimate.

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Operating cash flow reached $946 million and free cash flow $759 million, both second-quarter records. Eaton is raising its full-year 2024 guidance for organic growth, segment margins, and EPS, citing strong demand across its markets and increased backlog. For third-quarter 2024, the company expects organic growth of 8-9%, segment margins of 23.5-23.9%, and EPS between $2.42 and $2.52.

Notable segment performances include Electrical Americas with record sales and operating profits, Aerospace with record sales and profits, and eMobility with record sales, while the Vehicle segment saw a slight decline in sales but improved margins.

How To Buy ETN Stock: By now you're likely curious about how to participate in the market for Eaton Corp – be it to purchase shares, or even attempt to bet against the company.

Buying shares is typically done through a brokerage account. You can find a list of possible trading platforms here. Many will allow you to buy ‘fractional shares,' which allows you to own portions of stock without buying an entire share. For example, some stock, like Berkshire Hathaway, or Amazon.com, can cost thousands of dollars to own just one share. However, if you only want to invest a fraction of that, brokerages will allow you to do so.

In the the case of Eaton Corp, which is trading at $296.37 as of publishing time, $100 would buy you 0.34 shares of stock.

If you're looking to bet against a company, the process is more complex. You'll need access to an options trading platform, or a broker who will allow you to ‘go short' a share of stock by lending you the shares to sell. The process of shorting a stock can be found at this resource. Otherwise, if your broker allows you to trade options, you can either buy a put option, or sell a call option at a strike price above where shares are currently trading — either way, it allows you to profit off of the share price decline.

Price Action: Eaton has a 52-week low of $191.82.

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