Analyzing Eaton (NYSE:ETN) and NuScale Power (NYSE:SMR)

NuScale Power (NYSE:SMR) and Eaton (NYSE:ETN) are both industrials companies, but which is the superior investment? We will compare the two businesses based on the strength of their valuation, risk, analyst recommendations, dividends, earnings, profitability and institutional ownership.

Risk and Volatility

NuScale Power has a beta of 2.36, meaning that its share price is 136% more volatile than the S&P 500. Comparatively, Eaton has a beta of 1.13, meaning that its share price is 13% more volatile than the S&P 500.

Insider & Institutional Ownership

78.4% of NuScale Power shares are held by institutional investors. Comparatively, 83.0% of Eaton shares are held by institutional investors. 1.3% of NuScale Power shares are held by insiders. Comparatively, 0.1% of Eaton shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Profitability

This table compares NuScale Power and Eaton’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
NuScale Power	-3,888.70%	-35.59%	-30.27%
Eaton	12.75%	24.58%	9.98%

Valuation & Earnings

This table compares NuScale Power and Eaton”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
NuScale Power	$31.48 million	76.72	-$355.79 million	($2.92)	-1.92
Eaton	$27.45 billion	5.22	$4.09 billion	$9.83	37.56

Eaton has higher revenue and earnings than NuScale Power. NuScale Power is trading at a lower price-to-earnings ratio than Eaton, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a summary of current ratings and target prices for NuScale Power and Eaton, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
NuScale Power	4	7	4	1	2.12
Eaton	0	2	20	1	2.96

NuScale Power currently has a consensus price target of $10.67, indicating a potential upside of 89.80%. Eaton has a consensus price target of $484.10, indicating a potential upside of 31.12%. Given NuScale Power’s higher probable upside, analysts plainly believe NuScale Power is more favorable than Eaton.

Summary

Eaton beats NuScale Power on 10 of the 14 factors compared between the two stocks.

About NuScale Power

NuScale Power Corporation engages in the development and sale of modular light water reactor nuclear power plants to supply energy for electrical generation, district heating, desalination, hydrogen production, and other process heat applications. It offers NuScale Power Module (NPM), a water reactor that can generate 77 megawatts of electricity (MWe); and VOYGR power plant designs for three facility sizes that are capable of housing from one to four and six or twelve NPMs. The company was founded in 2007 and is headquartered in Portland, Oregon. NuScale Power Corporation operates as a subsidiary of Fluor Enterprises, Inc.

About Eaton

Eaton Corporation plc operates as a power management company worldwide. The company’s Electrical Americas and Electrical Global segment provides electrical components, industrial components, power distribution and assemblies, residential products, single and three phase power quality and connectivity products, wiring devices, circuit protection products, utility power distribution products, power reliability equipment, and services, as well as hazardous duty electrical equipment, emergency lighting, fire detection, explosion-proof instrumentation, and structural support systems. Its Aerospace segment offers pumps, motors, hydraulic power units, hoses and fittings, and electro-hydraulic pumps; valves, cylinders, electronic controls, electromechanical actuators, sensors, aircraft flap and slat systems, and nose wheel steering systems; hose, thermoplastic tubing products, fittings, adapters, couplings, and sealing and ducting products; air-to-air refueling systems, fuel pumps, fuel inerting products, sensors, and adapters and regulators; oxygen generation system, payload carriages, and thermal management products; and wiring connectors and cables, as well as hydraulic and bag filters, strainers and cartridges, and golf grips for manufacturers of commercial and military aircraft, and related after-market customers, as well as industrial applications. The company’s Vehicle segment offers transmissions, clutches, hybrid power systems, superchargers, engine valves and valve actuation systems, locking and limited slip differentials, transmission controls, and fuel vapor components for the vehicle industry. Its eMobility segment provides voltage inverters, converters, fuses, circuit protection units, vehicle controls, power distribution systems, fuel tank isolation valves, and commercial vehicle hybrid systems. Eaton Corporation plc was founded in 1911 and is based in Dublin, Ireland.