Eaton (NYSE:ETN – Get Free Report) and Sensata Technologies (NYSE:ST – Get Free Report) are both industrials companies, but which is the superior business? We will contrast the two companies based on the strength of their profitability, dividends, analyst recommendations, earnings, risk, valuation and institutional ownership.
Analyst Recommendations
This is a summary of recent recommendations for Eaton and Sensata Technologies, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Eaton | 0 | 2 | 20 | 1 | 2.96 |
| Sensata Technologies | 1 | 4 | 5 | 0 | 2.40 |
Eaton currently has a consensus price target of $482.09, suggesting a potential upside of 33.63%. Sensata Technologies has a consensus price target of $50.33, suggesting a potential upside of 24.56%. Given Eaton’s stronger consensus rating and higher probable upside, equities research analysts plainly believe Eaton is more favorable than Sensata Technologies.
Profitability
This table compares Eaton and Sensata Technologies’ net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Eaton | 12.18% | 25.09% | 9.62% |
| Sensata Technologies | 9.52% | 19.38% | 8.43% |
Dividends
Eaton pays an annual dividend of $4.40 per share and has a dividend yield of 1.2%. Sensata Technologies pays an annual dividend of $0.48 per share and has a dividend yield of 1.2%. Eaton pays out 44.0% of its earnings in the form of a dividend. Sensata Technologies pays out 19.2% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years.
Earnings & Valuation
This table compares Eaton and Sensata Technologies”s gross revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Eaton | $31.98 billion | 4.38 | $4.09 billion | $10.01 | 36.04 |
| Sensata Technologies | $3.85 billion | 1.53 | $31.30 million | $2.50 | 16.16 |
Eaton has higher revenue and earnings than Sensata Technologies. Sensata Technologies is trading at a lower price-to-earnings ratio than Eaton, indicating that it is currently the more affordable of the two stocks.
Volatility & Risk
Eaton has a beta of 1.15, indicating that its stock price is 15% more volatile than the S&P 500. Comparatively, Sensata Technologies has a beta of 1.28, indicating that its stock price is 28% more volatile than the S&P 500.
Insider and Institutional Ownership
83.0% of Eaton shares are held by institutional investors. Comparatively, 99.4% of Sensata Technologies shares are held by institutional investors. 0.1% of Eaton shares are held by insiders. Comparatively, 0.7% of Sensata Technologies shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.
Summary
Eaton beats Sensata Technologies on 13 of the 17 factors compared between the two stocks.
About Eaton
Eaton Corporation plc operates as a power management company worldwide. The company’s Electrical Americas and Electrical Global segment provides electrical components, industrial components, power distribution and assemblies, residential products, single and three phase power quality and connectivity products, wiring devices, circuit protection products, utility power distribution products, power reliability equipment, and services, as well as hazardous duty electrical equipment, emergency lighting, fire detection, explosion-proof instrumentation, and structural support systems. Its Aerospace segment offers pumps, motors, hydraulic power units, hoses and fittings, and electro-hydraulic pumps; valves, cylinders, electronic controls, electromechanical actuators, sensors, aircraft flap and slat systems, and nose wheel steering systems; hose, thermoplastic tubing products, fittings, adapters, couplings, and sealing and ducting products; air-to-air refueling systems, fuel pumps, fuel inerting products, sensors, and adapters and regulators; oxygen generation system, payload carriages, and thermal management products; and wiring connectors and cables, as well as hydraulic and bag filters, strainers and cartridges, and golf grips for manufacturers of commercial and military aircraft, and related after-market customers, as well as industrial applications. The company’s Vehicle segment offers transmissions, clutches, hybrid power systems, superchargers, engine valves and valve actuation systems, locking and limited slip differentials, transmission controls, and fuel vapor components for the vehicle industry. Its eMobility segment provides voltage inverters, converters, fuses, circuit protection units, vehicle controls, power distribution systems, fuel tank isolation valves, and commercial vehicle hybrid systems. Eaton Corporation plc was founded in 1911 and is based in Dublin, Ireland.
About Sensata Technologies
Sensata Technologies Holding plc develops, manufactures, and sells sensors and sensor-rich solutions, electrical protection components and systems, and other products used in mission-critical systems and applications in the United States and internationally. It operates in two segments, Performance Sensing and Sensing Solutions. The Performance Sensing segment offers pressure, temperature, and position sensors, high-voltage solutions, and other solutions used in mission-critical systems and applications, such as tire pressure monitoring, thermal management, electrical protection, regenerative braking, powertrain for engine/transmission, and exhaust management for automobiles, on-road trucks, and off-road equipment customers. The Sensing Solutions segment provides application-specific sensor and electrical protection products, such as pressure, temperature, and position sensors; motor and compressor protectors; high-voltage contactors; solid state relays; bimetal electromechanical controls; power inverters; charge controllers; battery management systems; operator controls; and power conversion systems. It serves automotive, on-road truck, construction, and original equipment manufacturers in agriculture, control, appliance, medical, energy and charging infrastructure, data/telecom, and aerospace and defense industries, as well as systems integrators, aerospace, and motor and compressor distributors. Sensata Technologies Holding plc was founded in 1916 and is headquartered in Attleboro, Massachusetts.
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