Citibank (NYSE: C) maintained its buy rating on Eaton (NYSE: ETN) and raised its price target to $82.00, up from $77.00, citing high peer multiples.

Citibank Analyst Timothy Thein said, “Our detailed analysis of ETN’s Power Quality business furthers our conviction in the significant cyclical / secular growth potential ahead, but also the role it plays in establishing a higher normalized profit and ROIC profile for the company versus past cycles (considering it’s only 6 years old). Currently accounting for 14% of total sales (est. ~23% of operating EBIT), we see revenue contribution from PQ approaching ~20% (organically) within 5 years.

He continued, “We see ETN benefiting from near-term recovery in certain key end-markets, and attractive longer-term secular trends. Continued solid FCF (well in excess of EPS in 2011) and well-positioned balance sheet should support near-term cash deployment catalysts (not in our model), including potential M&A-driven growth and dividend increases (which mgmt believes should keep pace with EPS growth over time).”

Citibank expects the company to report 2010 earnings per share of $3.95, versus consensus estimates of $3.99.