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Caterpillar Inc. (NYSE:(CAT - Free Report) – Free Report), a Zacks Ranked #1 (Strong Buy), is the world's largest manufacturer of construction and mining equipment, diesel and natural gas engines and industrial gas turbines. The company is one of only a handful of U.S. companies that leads its industry while competing globally from a principally domestic manufacturing base. The company records more than half of its sales to overseas customers. Their products are used in the construction, road building, mining, forestry, energy, transportation and material-handling industries.
Recent Earnings Report
Last week, Caterpillar reported Q2 17 earnings where they easily beat both the Zacks consensus earnings and revenue estimates. On a year over year basis, second quarter sales rose by +9.7%, profit per share improved by +45.2%, and adjusted profit per share (including restructuring costs) was up by +36.7%.
Management Raises Future Guidance
Due to increased demand across several segments, and efficient cost control, management increased both sales, and profit per share guidance for FY 17. Sales guidance was raised from a range of $38-41 billion to a range of $42-44 billion. Profit per share was lifted from $2.10 to $3.50.
Management’s Take
According to Jim Umpleby, CEO, “Our team delivered an impressive quarter. As demand increased, we continued to control costs and generated higher profit margins. While a number of our end markets remain challenged, construction in China and gas compression in North America were highlights in the quarter. Mining and oil-related activities have come off of recent lows, and we are seeing improving demand for construction in most regions.”
Mr. Umleby continued, “Given our performance in the first half of the year and current quotation and ordering activity, we are confident in raising our full-year 2017 outlook. We remain focused on serving our customers, delivering strong operational performance and executing our ongoing restructuring activities. During the second half of 2017, we anticipate making targeted investments in initiatives that are important to our future competitiveness, including enhanced digital capabilities and accelerating technology updates to our products. We intend to do this without adding to the structural costs we’ve worked so hard to streamline. These investments will prepare us to take advantage of the growth opportunities ahead.”
Bear:
Green Plains(NASDAQ:(GPRE - Free Report) – Free Report), a Zacks Ranked #5 (Strong Sell), is a vertically integrated producer, marketer and distributer of ethanol. The company operates through four segments: Ethanol Production, Corn Oil Production, Agribusiness, and Marketing and Distribution. It produces ethanol and co-products, such as wet, modified wet or dried distillers grains, as well as extracts non-edible corn oil. The company is also involved in buying and selling bulk grain primarily corn and soybeans. Green Plains Inc., formerly known as Green Plains Renewable Energy, Inc., is headquartered in Omaha, Nebraska.
Recent Earnings Report
On Monday the company reported Q2 17 earnings where they significantly missed both the Zacks consensus earnings estimate (-$0.41 actual vs. -$0.11 estimated), and revenue estimate ($886.3 million actual vs. $1 billion estimate). Management cited weak ethanol margins as the main culprit behind the large miss. On a year over year basis, the company saw declines in the following; net loss attributable was $16.4 million verse net income of $8.2 million, and consolidated revenues fell by $1.5 million. Management stated that “revenues were impacted by decreased grain trading activity and lower average realized prices for distillers’ grains.”
Management’s Take
According to Todd Baker, president and CEO, “While we’re not happy with the bottom line results this quarter, our balance sheet remains strong and we will continue to focus on growing and diversifying our business going forward. Based on current markets, we expect better performance in the third and fourth quarters and will move quickly to reduce volatility and lock away margins as they expand from here.”
Additional content:
Apple Posts Big Q3 Numbers, Trades Up 5%
The biggest component on the Dow as well as the second-biggest gainer on the Dow is Apple Inc. (NASDAQ:AAPL – Free Report), which is trading up further in the after-market following a clear earnings and sales beat in the company's fiscal Q3 2017. Apple beat earnings estimates by a dime to $1.67 per share on $45.4 billion in revenues, which beat the Zacks consensus of $44.7 billion.
Unit sales were mostly strong; iPhone sales of 41 million in the quarter narrowly missed the 41.1 million anticipated, whereas iPads well-outperformed the 9 million shipments expected by posting 11.4 million. Macs also topped estimates of 4 million units shipped to 4.3 million. Gross margins for Q3 reached 38.5%, the high end of the company's guidance range. Services rose 22% to $7.3 billion, as Other Products (including the Apple Watch) brought in $2.7 billion.
Shares are really popping in the late market, now up close to 5%. This follows nearly 30% gains year to date and 44% over the past year. Due to the absence of the new iPhone 8 -- expected to be released later this year -- many analysts expected a lackluster quarter, and Apple outperformed its routinely modest guidance figures. Once the iPhone 8 does hit the market, perhaps in early fiscal Q1 2018, pent-up demand and a high sticker price should further push Apple shares upward. And the stock has now rocketed up to a new all-time high.
Cyber-security company FireEye (NASDAQ:FEYE – Free Report) outperformed analyst estimates on both top and bottom lines this afternoon. This rather volatile firm -- which is up more than 25% year to date but down more than 10% over the past year -- reported a loss of 26 cents per share (accounting for stock-based compensation and other BNRI) on $185.5 million in quarterly sales. These topped the -39 cents per share and $176.3 million expected.
Shares ramped up close to 8% immediately following its report, but have tapered off just a bit more recently. Still, a big surge following the record lows hit earlier in 2017. The company is currently a Zacks Rank #3.
About the Bull and Bear of the Day
Every day, the analysts at Zacks Equity Research select two stocks that are likely to outperform (Bull) or underperform (Bear) the markets over the next 3-6 months.
About Zacks Equity Research
Zacks Equity Research provides the best of quantitative and qualitative analysis to help investors know what stocks to buy and which to sell for the long-term.
Continuous analyst coverage is provided for a universe of 1,150 publicly traded stocks. Our analysts are organized by industry which gives them keen insights to developments that affect company profits and stock performance. Recommendations and target prices are six-month time horizons.
Strong Stocks that Should Be in the News
Many are little publicized and fly under the Wall Street radar. They're virtually unknown to the general public. Yet today's 220 Zacks Rank #1 "Strong Buys" were generated by the stock-picking system that has nearly tripled the market from 1988 through 2015. Its average gain has been a stellar +26% per year. See these high-potential stocks free >>.
Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates.
Zacks.com provides investment resources and informs you of these resources, which you may choose to use in making your own investment decisions. Zacks is providing information on this resource to you subject to the Zacks "Terms and Conditions of Service" disclaimer. www.zacks.com/disclaimer.
Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performancefor information about the performance numbers displayed in this press release
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Caterpillar, Green Plains, Apple and Fire Eye highlighted as Zacks Bull and Bear of the Day
For Immediate Release
Chicago, IL – August 02, 2017 – Zacks Equity Research highlights Caterpillar Inc. (NYSE:CAT – Free Report) as the Bull of the Day Green Plains (NASDAQ:GPRE – Free Report) as the Bear of the Day. In addition, Zacks Equity Research provides analysis on Apple Inc. (NASDAQ:AAPL – Free Report) and FireEye (NASDAQ:FEYE – Free Report).
Here is a synopsis of all four stocks:
Bull of the Day:
Caterpillar Inc. (NYSE:(CAT - Free Report) – Free Report), a Zacks Ranked #1 (Strong Buy), is the world's largest manufacturer of construction and mining equipment, diesel and natural gas engines and industrial gas turbines. The company is one of only a handful of U.S. companies that leads its industry while competing globally from a principally domestic manufacturing base. The company records more than half of its sales to overseas customers. Their products are used in the construction, road building, mining, forestry, energy, transportation and material-handling industries.
Recent Earnings Report
Last week, Caterpillar reported Q2 17 earnings where they easily beat both the Zacks consensus earnings and revenue estimates. On a year over year basis, second quarter sales rose by +9.7%, profit per share improved by +45.2%, and adjusted profit per share (including restructuring costs) was up by +36.7%.
Management Raises Future Guidance
Due to increased demand across several segments, and efficient cost control, management increased both sales, and profit per share guidance for FY 17. Sales guidance was raised from a range of $38-41 billion to a range of $42-44 billion. Profit per share was lifted from $2.10 to $3.50.
Management’s Take
According to Jim Umpleby, CEO, “Our team delivered an impressive quarter. As demand increased, we continued to control costs and generated higher profit margins. While a number of our end markets remain challenged, construction in China and gas compression in North America were highlights in the quarter. Mining and oil-related activities have come off of recent lows, and we are seeing improving demand for construction in most regions.”
Mr. Umleby continued, “Given our performance in the first half of the year and current quotation and ordering activity, we are confident in raising our full-year 2017 outlook. We remain focused on serving our customers, delivering strong operational performance and executing our ongoing restructuring activities. During the second half of 2017, we anticipate making targeted investments in initiatives that are important to our future competitiveness, including enhanced digital capabilities and accelerating technology updates to our products. We intend to do this without adding to the structural costs we’ve worked so hard to streamline. These investments will prepare us to take advantage of the growth opportunities ahead.”
Bear:
Green Plains(NASDAQ:(GPRE - Free Report) – Free Report), a Zacks Ranked #5 (Strong Sell), is a vertically integrated producer, marketer and distributer of ethanol. The company operates through four segments: Ethanol Production, Corn Oil Production, Agribusiness, and Marketing and Distribution. It produces ethanol and co-products, such as wet, modified wet or dried distillers grains, as well as extracts non-edible corn oil. The company is also involved in buying and selling bulk grain primarily corn and soybeans. Green Plains Inc., formerly known as Green Plains Renewable Energy, Inc., is headquartered in Omaha, Nebraska.
Recent Earnings Report
On Monday the company reported Q2 17 earnings where they significantly missed both the Zacks consensus earnings estimate (-$0.41 actual vs. -$0.11 estimated), and revenue estimate ($886.3 million actual vs. $1 billion estimate). Management cited weak ethanol margins as the main culprit behind the large miss. On a year over year basis, the company saw declines in the following; net loss attributable was $16.4 million verse net income of $8.2 million, and consolidated revenues fell by $1.5 million. Management stated that “revenues were impacted by decreased grain trading activity and lower average realized prices for distillers’ grains.”
Management’s Take
According to Todd Baker, president and CEO, “While we’re not happy with the bottom line results this quarter, our balance sheet remains strong and we will continue to focus on growing and diversifying our business going forward. Based on current markets, we expect better performance in the third and fourth quarters and will move quickly to reduce volatility and lock away margins as they expand from here.”
Additional content:
Apple Posts Big Q3 Numbers, Trades Up 5%
The biggest component on the Dow as well as the second-biggest gainer on the Dow is Apple Inc. (NASDAQ:AAPL – Free Report), which is trading up further in the after-market following a clear earnings and sales beat in the company's fiscal Q3 2017. Apple beat earnings estimates by a dime to $1.67 per share on $45.4 billion in revenues, which beat the Zacks consensus of $44.7 billion.
Unit sales were mostly strong; iPhone sales of 41 million in the quarter narrowly missed the 41.1 million anticipated, whereas iPads well-outperformed the 9 million shipments expected by posting 11.4 million. Macs also topped estimates of 4 million units shipped to 4.3 million. Gross margins for Q3 reached 38.5%, the high end of the company's guidance range. Services rose 22% to $7.3 billion, as Other Products (including the Apple Watch) brought in $2.7 billion.
Shares are really popping in the late market, now up close to 5%. This follows nearly 30% gains year to date and 44% over the past year. Due to the absence of the new iPhone 8 -- expected to be released later this year -- many analysts expected a lackluster quarter, and Apple outperformed its routinely modest guidance figures. Once the iPhone 8 does hit the market, perhaps in early fiscal Q1 2018, pent-up demand and a high sticker price should further push Apple shares upward. And the stock has now rocketed up to a new all-time high.
For more on Apple's earnings results, click here.
Cyber-security company FireEye (NASDAQ:FEYE – Free Report) outperformed analyst estimates on both top and bottom lines this afternoon. This rather volatile firm -- which is up more than 25% year to date but down more than 10% over the past year -- reported a loss of 26 cents per share (accounting for stock-based compensation and other BNRI) on $185.5 million in quarterly sales. These topped the -39 cents per share and $176.3 million expected.
Shares ramped up close to 8% immediately following its report, but have tapered off just a bit more recently. Still, a big surge following the record lows hit earlier in 2017. The company is currently a Zacks Rank #3.
About the Bull and Bear of the Day
Every day, the analysts at Zacks Equity Research select two stocks that are likely to outperform (Bull) or underperform (Bear) the markets over the next 3-6 months.
About Zacks Equity Research
Zacks Equity Research provides the best of quantitative and qualitative analysis to help investors know what stocks to buy and which to sell for the long-term.
Continuous analyst coverage is provided for a universe of 1,150 publicly traded stocks. Our analysts are organized by industry which gives them keen insights to developments that affect company profits and stock performance. Recommendations and target prices are six-month time horizons.
Strong Stocks that Should Be in the News
Many are little publicized and fly under the Wall Street radar. They're virtually unknown to the general public. Yet today's 220 Zacks Rank #1 "Strong Buys" were generated by the stock-picking system that has nearly tripled the market from 1988 through 2015. Its average gain has been a stellar +26% per year. See these high-potential stocks free >>.
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Zacks.com provides investment resources and informs you of these resources, which you may choose to use in making your own investment decisions. Zacks is providing information on this resource to you subject to the Zacks "Terms and Conditions of Service" disclaimer. www.zacks.com/disclaimer.
Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performancefor information about the performance numbers displayed in this press release