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Caterpillar (CAT) Gains But Lags Market: What You Should Know

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Caterpillar (CAT - Free Report) closed at $133.11 in the latest trading session, marking a +1.34% move from the prior day. This change lagged the S&P 500's 1.47% gain on the day. Elsewhere, the Dow gained 0.79%, while the tech-heavy Nasdaq added 2.02%.

Heading into today, shares of the construction equipment company had gained 2% over the past month, lagging the Industrial Products sector's gain of 2.3% and outpacing the S&P 500's gain of 1.5% in that time.

CAT will be looking to display strength as it nears its next earnings release. In that report, analysts expect CAT to post earnings of $2.86 per share. This would mark year-over-year growth of 1.42%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $13.42 billion, up 4.39% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $12.23 per share and revenue of $57.45 billion, which would represent changes of +9% and +4.98%, respectively, from the prior year.

Investors should also note any recent changes to analyst estimates for CAT. Recent revisions tend to reflect the latest near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection has moved 0.02% higher. CAT is currently sporting a Zacks Rank of #4 (Sell).

Valuation is also important, so investors should note that CAT has a Forward P/E ratio of 10.74 right now. This valuation marks a no noticeable deviation compared to its industry's average Forward P/E of 10.74.

Investors should also note that CAT has a PEG ratio of 0.59 right now. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. CAT's industry had an average PEG ratio of 0.86 as of yesterday's close.

The Manufacturing - Construction and Mining industry is part of the Industrial Products sector. This industry currently has a Zacks Industry Rank of 17, which puts it in the top 7% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

You can find more information on all of these metrics, and much more, on Zacks.com.




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