Core Thesis - Eaton Corporation plc is positioned as a strong player in the power management sector, with a focus on high-growth areas such as AI infrastructure and electrification projects, supported by strategic acquisitions and robust financial performance [1][4]. Financial Performance - For Q3 2025, Eaton reported total revenue of $6.99 billion, slightly below expectations, but adjusted EPS reached $3.07, with record segment margins indicating operational strength [2]. - The Electrical Americas segment generated $3.41 billion in revenue, reflecting a 15% year-over-year increase and a remarkable 30.3% operating margin, driven by demand in data centers and AI infrastructure [2]. Orders and Backlog - Orders showed a 12-month rollover growth of 7%, with a backlog increase of 20%, indicating strong visibility for future performance [3]. Strategic Acquisitions - The $9.5 billion acquisition of Boyd Thermal enhances Eaton's capabilities in providing AI power and liquid cooling solutions, particularly for hyperscale data centers [4]. Cash Flow and Guidance - Eaton achieved a record free cash flow of $1.2 billion, which supports growth initiatives and shareholder returns [4]. - The guidance for full-year adjusted EPS has been revised upward to $12.07, reflecting strong organic growth and improved segment margins [4]. Valuation - Eaton's valuation remains attractive, with forward P/E and DCF models suggesting a fair value range of $335–$402, close to its current trading price of $367.91 [5].