It’s been a great month for Eaton stock. The power management company notched a series of record highs during a lengthy post-earnings rally that saw shares surge 17% in February. So, what’s next? Some would take profits when a stock has been on a tear like this, but we’re holding on for more long-term gains. That’s because what’s fueling Eaton’s recent run highlights future tailwinds as well. Eaton hit a record high on Feb. 1 after posting a better-than-expected quarter . An upbeat 2024 outlook set the industrial company apart from its peers, which issued more conservative guidance. On earnings day, we hiked our Club price target on Eaton to $290 per share from $255 and maintained our buy-equivalent 1 rating. The stock finished Friday at another record high close just below our PT. ETN YTD mountain Eaton (ETN) year-to-date performance As of Friday’s close, Eaton was the fifth-best performer among S & P 500 industrial stocks, with a year-to-date gain of more than 18%. The sector as a whole has increased just over 5% this year. The drivers of Eaton’s current rally underscore why we first jumped into the stock back in November and why we continue to see upside. They include infrastructure spending, further artificial intelligence adoption necessitating the construction of more data centers, the acceleration of the transition to clean energy, and the rise of nearshoring and onshoring. There have been trillions of dollars allocated by President Joe Biden’s various domestic funding bills — including the Infrastructure Investment and Jobs Act, which was signed in 2021, and the Inflation and Reduction Act (IRA), which was put into law in 2022 — for projects that call for Eaton’s expertise to make sure power solutions work safely, efficiently, reliably and sustainably. Eaton management has said more infrastructure spending will play into the company’s long-term growth because of its exposure to key markets like commercial and residential buildings, data centers, and…
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