Eaton Corp. Upgraded To Buy

Goldman Sachs has upgraded Eaton Corporation (NYSE: ETN) from Neutral to Buy and has added the company to Goldman's Conviction List.

In the report, Goldman Sachs writes "We raise our 2011/2012 EPS to $7.80/$9.40 from $7.35/$8.90 and our 12-month price target to $117 (15X 2011E EPS from 14X) from $103 for 24% upside. Despite strong 2010 performance, we believe estimate revisions will remain strong and drive further momentum, with GS now 12%/16% above consensus and likely still too low. With above-average late-cycle and emerging-markets exposure, a balance sheet that will move into a more offensive posture in 2012 and more cyclical businesses (Truck, Hydraulics) still below mid-cycle levels, we believe valuation can expand as well and is the basis for our higher target."

Goldman Sachs has also issued a $117 price target.

Eaton Corporation closed yesterday at $94.11.