Caterpillar Inc. CAT is one of the well known names in the construction and mining machinery industry with a market capitalization of $41.99 billion. It is also a leading exporter in the U.S. with more than half of its sales being generated outside the United States.
Last month, there was the furor when the company slashed its 2015 revenue outlook citing weakness in its main industry sectors – mining and energy. Caterpillar’s sales continue to bear the brunt of weak mining demand as mining companies keep on reducing their capital expenditures. Lower oil prices has also negatively impact both engine sales for oil production and demand for construction machines used for energy site preparations. A stronger dollar and continued weakness in agriculture has negatively impacted sales.
Caterpillar’s results are a much looked upon event as the mining and equipment behemoth has long been considered a bellwether of national and global economic strength. Caterpillar had cautioned that the decline in sales outlook and higher restructuring costs will have a negative impact on its third-quarter performance. The company will provide its fiscal 2015 earnings guidance during its financial release. Investors have thus been eagerly awaiting the company’s latest earnings report. Let’s have a quick look at the third quarter release of this Peoria, Illinois-based construction and mining behemoth.
Estimate Trend & Surprise History
Investors should note that the earnings estimate for Caterpillar for the third quarter has moved south over the past week and month. Investors should note that Zacks Consensus Estimate for the third quarter for earnings of 75 cents per share has dipped 11% over the last 30 days.
Caterpillar has beaten the Zacks Consensus Estimate in 3 of the trailing 4 quarters with an average beat of around 13.95%.
Earnings In Line With Estimates
Caterpillar raked in adjusted earnings of 75 cents per share, in line with the Zacks Consensus Estimate.
Revenues Fails to Match Estimates
Caterpillar reported third quarter revenues of $10.96 billion, falling short of the Zacks Consensus Estimate of $11.1 billion.
Developments to Note
For fiscal 2015, Caterpillar maintained its revenue guidance of $48 billion and has projected earnings of $4.60 (excluding restructuring costs). For 2016, the company expects sales to be 5% below 2015 levels.
Zacks Rank
Currently, Caterpillar has a Zacks Rank #5 (Strong Sell). However, this could change following Caterpillar’s earnings report which was just released.
Market Reaction
Caterpillar shares surged dipped 2.54% in pre-market trading.
Check back later for our full write up on this Caterpillar earnings report later!
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