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Eaton Corp PLC (NYSE:ETN)
Median P/S Value
$48.49 (As of Today)

This valuation method assumes that the stock valuation will revert to its historical mean in terms of Price/Sales Ratio. The reason we use P/S Ratio instead of P/E Ratio or P/B Ratio is because Price/Sales Ratio is independent of profit margin, and can be applied to a broader range of situations.

Median P/S Value is calculated as trailing twelve months (TTM) revenue per share times 10-Year median P/S ratio. Eaton Corp PLC's revenue per share for the trailing twelve months (TTM) ended in Sep. 2014 was $47.08. Eaton Corp PLC's 10-Year median P/S ratio is 1.03. Therefore, the Median P/S Value for today is $48.49.

As of today, Eaton Corp PLC's share price is $67.45. Eaton Corp PLC's median P/S value is $48.49. Therefore, Eaton Corp PLC's Price to Median P/S Value Ratio for today is 1.39.

ETN' s 10-Year Price to Median P/S Value Range
Min: 0.4   Max: 1.6
Current: 1.39

0.4
1.6

During the past 13 years, the highest Price to Median P/S Value Ratio of Eaton Corp PLC was 1.60. The lowest was 0.40. And the median was 0.81.

ETN's Price to Median P/S Value is ranked higher than
59% of the 2161 Companies
in the Global Diversified Industrials industry.

( Industry Median: 1.16 vs. ETN: 1.39 )

Definition

Eaton Corp PLC's Median P/S Value for today is calculated as

Median P/S Value=Total Annual Sales / Shares Outstanding*10-Year Median P/S Ratio
=Revenue per Share (TTM)*10-Year Median P/S Ratio
=47.08*1.03
=48.49

10-Year Median P/S Ratio is 1.03.
Eaton Corp PLC's revenue per share for the trailing twelve months (TTM) ended in Sep. 2014 was 11.56 (Dec. 2013 ) + 11.47 (Mar. 2014 ) + 12.05 (Jun. 2014 ) + 12 (Sep. 2014 ) = $47.08.

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.


Explanation

This valuation method assumes that the stock valuation will revert to its historical mean in terms of Price/Sales Ratio. The reason we use P/S Ratio instead of P/E Ratio or P/B Ratio is because Price/Sales Ratio is independent of profit margin, and can be applied to a broader range of situations.

It also assumes that over time the profit margin is constant. If a company increases its profit margin to a sustainable level, this value might under-estimate its value. If it has permanent declined profit margins, this may over-estimate the company’s value.

Eaton Corp PLC's Price to Median P/S Value Ratio for today is calculated as

Price to Median P/S Value=Share Price/Median P/S Value
=67.45/48.49
=1.39

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.


Related Terms

P/E Ratio, P/B Ratio, P/S Ratio, Intrinsic Value (DCF Projected), Intrinsic Value (DCF), Intrinsic Value (DE), Graham Number, GAVA


Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.

Eaton Corp PLC Annual Data

Dec04Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13
medpsvalue 31.8436.5741.3144.6548.7736.5041.6048.2247.9247.64

Eaton Corp PLC Quarterly Data

Jun12Sep12Dec12Mar13Jun13Sep13Dec13Mar14Jun14Sep14
medpsvalue 49.0548.6047.9247.4347.2047.3447.6447.9448.2348.49
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