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Caterpillar (CAT) Earnings Beat, Revenues Miss in Q3
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Caterpillar Inc. (CAT - Free Report) is one of the well-known names in the construction and mining machinery industry with a market capitalization of $50.24 billion. It is a leading exporter in the U.S. with more than half of its sales being generated outside the country.
Ahead of its third quarter earnings release, Caterpillar reported an 18% decline in its global retail sales for the three months ended Sep 2016, following 17% dip in August and 19% decline in July. So far this year, Caterpillar’s monthly sales have posted an average fall of 15.4%. Demand for heavy machinery remained sluggish in all of its core markets amid a slowdown in construction and mining activity. This does not bode well for its third quarter 2016 performance.
This does not come as surprise as Caterpillar’s results for the past few quarters have borne the brunt of a weak mining industry, low oil prices, stronger U.S. dollar and China's economic woes. Continued weakness in agriculture have also negatively impacted sales. It remains to be seen whether improvement in construction and cost reduction can provide some respite to this ailing mining and equipment behemoth.
Investors are thus awaiting Caterpillar’s results as it has long been considered a bellwether of national and global economic strength. Let’s have a quick look at the third quarter release of this Peoria, Illinois-based construction and mining equipment manufacturer.
Estimate Trend & Surprise History
Investors should note that over a 60 days timeframe, the Zacks Consensus Estimate for the third quarter has moved north for Caterpillar. Caterpillar has beaten the Zacks Consensus Estimate in all of the last four quarters with an average positive surprise of 5.20%.
Caterpillar beat the Zacks Consensus Estimate by 13%. Analysts polled by Zacks were expecting earnings per share (EPS) of 75 cents and the company reported adjusted EPS of 85 cents.
Revenues Miss Estimates
Caterpillar reported revenues of $9.16 billion, falling short of the Zacks Consensus Estimate of $9.803 billion.
Developments to Note
For 2016, Caterpillar projects adjusted earnings of $3.25 per share on the back of revenues in the range of $39 billion. The company also provided a preliminary outlook for 2017 and stated that revenues will not be significantly different than 2016.
Zacks Rank
Currently, Caterpillar has a Zacks Rank #2 (Buy). However, this could change following Caterpillar’s earnings report which was just released.
Market Reaction
Caterpillar shares fell 2.62% in pre-market trading.
Check back later for our full write up on this Caterpillar earnings report later!
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Caterpillar (CAT) Earnings Beat, Revenues Miss in Q3
Caterpillar Inc. (CAT - Free Report) is one of the well-known names in the construction and mining machinery industry with a market capitalization of $50.24 billion. It is a leading exporter in the U.S. with more than half of its sales being generated outside the country.
Ahead of its third quarter earnings release, Caterpillar reported an 18% decline in its global retail sales for the three months ended Sep 2016, following 17% dip in August and 19% decline in July. So far this year, Caterpillar’s monthly sales have posted an average fall of 15.4%. Demand for heavy machinery remained sluggish in all of its core markets amid a slowdown in construction and mining activity. This does not bode well for its third quarter 2016 performance.
This does not come as surprise as Caterpillar’s results for the past few quarters have borne the brunt of a weak mining industry, low oil prices, stronger U.S. dollar and China's economic woes. Continued weakness in agriculture have also negatively impacted sales. It remains to be seen whether improvement in construction and cost reduction can provide some respite to this ailing mining and equipment behemoth.
Investors are thus awaiting Caterpillar’s results as it has long been considered a bellwether of national and global economic strength. Let’s have a quick look at the third quarter release of this Peoria, Illinois-based construction and mining equipment manufacturer.
Estimate Trend & Surprise History
Investors should note that over a 60 days timeframe, the Zacks Consensus Estimate for the third quarter has moved north for Caterpillar. Caterpillar has beaten the Zacks Consensus Estimate in all of the last four quarters with an average positive surprise of 5.20%.
CATERPILLAR INC Price and EPS Surprise
CATERPILLAR INC Price and EPS Surprise | CATERPILLAR INC Quote
Earnings Beat Estimates
Caterpillar beat the Zacks Consensus Estimate by 13%. Analysts polled by Zacks were expecting earnings per share (EPS) of 75 cents and the company reported adjusted EPS of 85 cents.
Revenues Miss Estimates
Caterpillar reported revenues of $9.16 billion, falling short of the Zacks Consensus Estimate of $9.803 billion.
Developments to Note
For 2016, Caterpillar projects adjusted earnings of $3.25 per share on the back of revenues in the range of $39 billion. The company also provided a preliminary outlook for 2017 and stated that revenues will not be significantly different than 2016.
Zacks Rank
Currently, Caterpillar has a Zacks Rank #2 (Buy). However, this could change following Caterpillar’s earnings report which was just released.
Market Reaction
Caterpillar shares fell 2.62% in pre-market trading.
Check back later for our full write up on this Caterpillar earnings report later!
Confidential from Zacks
Beyond this Tale of the Tape, would you like to see Zacks' best recommendations that are not available to the public? Our Executive VP, Steve Reitmeister, knows when key trades are about to be triggered and which of our experts has the hottest hand. Click to see them now>>