Eaton Corp (ETN): Today's Featured Industrial Laggard

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 industry lower today making it today's featured Industrial laggard. The industry as a whole closed the day down 1.7%. By the end of trading, Eaton fell $1.02 (-2.1%) to $48.45 on average volume. Throughout the day, 3.7 million shares of Eaton exchanged hands as compared to its average daily volume of four million shares. The stock ranged in price between $48.32-$49.75 after having opened the day at $48.90 as compared to the previous trading day's close of $49.47. Other companies within the Industrial industry that declined today were: Renewable Energy Trade Board ( EBOD), down 9.1%, Hollysys Automation Technologies ( HOLI), down 8.4%, Exide Technologies ( XIDE), down 8.1%, and Highpower International ( HPJ), down 8%.
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Eaton Corporation operates as a diversified power management company worldwide. Eaton has a market cap of $16.74 billion and is part of the industrial goods sector. The company has a P/E ratio of 12, below the S&P 500 P/E ratio of 17.7. Shares are up 13.6% year to date as of the close of trading on Tuesday. 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 attractive valuation levels, largely solid financial position with reasonable debt levels by most measures, notable return on equity and increase in stock price during the past year. We feel these strengths outweigh the fact that the company has had sub par growth in net income.

For investors not wanting singular stock exposure, ETFs may be of interest. Investors who are bullish on the industrial industry could consider SPDR Dow Jones Industrial Average ( DIA) while those bearish on the industrial industry could consider ProShares UltraShort Industrials ( SIJ).

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