Eaton Corp PLC: 2Q26 Earnings preview: margins in focus

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Eaton Corp PLC: 2Q26 Earnings preview: margins in focus

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Eaton Corp PLC

2Q26 Earnings preview: margins in focus

Reiterate Rating: BUY | PO: 490.00 USD | Price: 407.28 USD

Beat, driven by Electrical Americas 13 July 2026

We view ETN as a “show me story” going into 2Q26 results. Electrical Americas margins Equity

are front and centers for investors, we view the quarter as an important juncture for

management to showcase execution in a robust market for electrical equipment. Andrew Obin Research Analyst

Management guided for 150bp of q/q improvement in EA margins implying ~27.1% in BofAS

2Q. We forecast in line with guidance at 27.1% EA segment margins, above ~27% +1andrew.obin@bofa.com646 855 1817

consensus. We forecast 2Q adj. EPS of $3.10, at the top of $3.00-3.10 guidance. We David Ridley-Lane, CFA

think investor attention will focus on Electrical Americas (EA) operating margins and Research Analyst

BofAS

orders growth. After strong orders in 1Q (EA 42% y/y TTM, data centers 240% q/q), We +1 646 855 2907

expect to remain strong, broadly in line with 1Q26 sequentially, with ~$7.9bn total david.ridleylane@bofa.com

Electrical and ~$4.9bn EA. After a raise last quarter, we still see the potential for a Devin Leonard

Research Analyst

repeat given strong data center and grid spend. With the pending divestiture of the BofAS

mobility business, Eaton is simplifying the business to higher growing segments. We +1 646 855 3698 devin.leonard@bofa.com

reiterate our Buy rating.

Walking through the margin improvement

Incremental margins troughed in 1Q26 and the company guiding to material ramp in Stock Data

operating leverage throughout 2026. Our meetings with management at the BofA Price 407.28 USD