Eaton Eyes E.A. Pedersen - Analyst Blog
December 19 2011 - 9:45AM
Zacks
Industrial manufacturer
Eaton Corporation (ETN) has decided to acquire
Omaha, Nebraska based E.A. Pedersen Company. The latter is the
manufacturer of medium voltage switchgear catering primarily to the
electrical utilities.
E.A. Pedersen Company’s offering of
products include metal-clad switchgear, power control buildings and
relay control panels. Eaton’s decision to acquire Pedersen Company
gels well with the strategy to strengthen its footprints in the
medium voltage assembly business by adding important
utility-oriented power products. Plus, this acquisition will add to
Eaton’s custom engineering capabilities for its U.S. customers.
We believe Eaton’s decision to
acquire an electrical equipment manufacturer is guided towards its
ulterior aim to transform into a diversified industrial enterprise
with important positions in core electrical, hydraulic and
aerospace markets. Eaton has hitherto been regarded as an
automotive and truck component manufacturer.
The company has also resorted to
timely acquisitions to expand its global reach. Its financial
strength allows for such strategic buys. In the third quarter, the
company acquired Canada based IE Power Inc., a provider of high
power inverters and Germany based E. Begerow GmbH & Co. KG, a
liquid filtration solution.
We believe Eaton’s overseas
presence and its capacity to supply diversified power accessories
to the aerospace industry have placed it in an advantageous
position. As per industry-wide traits, global commercial aerospace
is expected to grow substantially in the next couple of
decades.
Eaton Corporation currently retains
a Zacks #3 Rank, which translates into a short-term Hold rating.
The company competes with ITT Corporation (ITT)
and Parker Hannifin Corporation (PH).
Cleveland, Ohio-based diversified
power management company Eaton Corporation is a leading supplier of
power accessories in the aerospace industry and has customers
spanning 150 countries.
EATON CORP (ETN): Free Stock Analysis Report
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