Oh, I think Luca's comment is full and easy to understand.

I think "each other" is correct.

Hi Bardisy, can you provide a full sentence, for example?

both are correct. it depends on the context. for example: "they looked at each other" is correct, and so is: "they looked at each other's face". So the 's denotes possession. In this case, a statement is being made about something belonging to "each other" (face, dog, expression, whatever).