Eaton’s Solid First-Quarter Performance Doesn’t Materially Alter Our Long-Term View

Narrow moat rated Eaton turned in a solid first-quarter performance, but nothing in its latest results materially alters our long-term view of the firm. We made some modest adjustments to our near-term forecast, but the benefits of additional sales were mostly offset by slightly higher restructuring in operating margins than we were previously modeling. That said, we left our midcycle, non-GAAP segment operating margins intact. In summation, we raise our fair value estimate to $154 per share from $150 previously, but most of the raise was due to time value of money.