Eaton Corp (ETN): Today's Featured Industrial Goods Winner

Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.

Eaton ( ETN) pushed the Industrial Goods sector higher today making it today's featured industrial goods winner. The sector as a whole closed the day up 1%. By the end of trading, Eaton rose 82 cents (1.8%) to $47.10 on light volume. Throughout the day, 2.6 million shares of Eaton exchanged hands as compared to its average daily volume of 4.3 million shares. The stock ranged in a price between $46.47-$47.14 after having opened the day at $46.67 as compared to the previous trading day's close of $46.28. Other companies within the Industrial Goods sector that increased today were: Research Frontiers ( REFR), up 13.2%, Eagle Materials ( EXP), up 9.5%, MFRI ( MFRI), up 7.6%, and Jewett-Cameron Trading Company ( JCTCF), up 7.5%.
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Eaton Corporation operates as a diversified power management company worldwide. Eaton has a market cap of $15.61 billion and is part of the industrial industry. The company has a P/E ratio of 11.1, equal to the average industrial industry P/E ratio and below the S&P 500 P/E ratio of 17.7. Shares are up 6.3% year to date as of the close of trading on Wednesday. Currently there are 11 analysts that rate Eaton a buy, one analyst rates it a sell, and three rate it a hold.

TheStreet Ratings rates Eaton as a buy. The company's strengths can be seen in multiple areas, such as its solid stock price performance, impressive record of earnings per share growth, largely solid financial position with reasonable debt levels by most measures, attractive valuation levels and good cash flow from operations. We feel these strengths outweigh the fact that the company shows low profit margins.

For investors not wanting singular stock exposure, ETFs may be of interest. Investors who are bullish on the industrial goods sector could consider Industrial Select Sector SPDR ( XLI) while those bearish on the industrial goods sector could consider ProShares Short Dow 30 ( DOG).

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