The UBS analyst has examined past cycles to estimate potential trough and peak sales/earnings for Caterpillar (NYSE:CAT). The hypothetical trough/peak EPS is predicted to be approximately $12 and $33, respectively, with mid-cycle estimated at around $22. Despite these figures, Fisher anticipates a challenging first half of 2025 for Caterpillar, as North American construction adjusts after years of growth and as oil and gas expansion halts.For the first half of 2025, UBS's EPS estimate for Caterpillar is 3% below the consensus, with the expectation that negative revisions could further pressure the stock. Fisher's outlook is based on the assessment of the company's recent performance, which included narrower beats and an eventual miss in earnings, although there were higher margins in the construction sector and slightly more momentum in Energy & Transportation than initially expected. Despite these factors, the stock's reaction has not aligned with these developments, prompting the maintained Sell rating. It's worth noting that InvestingPro's comprehensive financial health assessment rates Caterpillar as "GREAT," with particularly strong scores in profitability and price momentum. For deeper insights into Caterpillar's valuation and future prospects, investors can access the detailed Pro Research Report, available exclusively to InvestingPro subscribers. It's worth noting that InvestingPro's comprehensive financial health assessment rates Caterpillar as "GREAT," with particularly strong scores in profitability and price momentum. For deeper insights into Caterpillar's valuation and future prospects, investors can access the detailed Pro Research Report, available exclusively to InvestingPro subscribers.
The UBS analyst has examined past cycles to estimate potential trough and peak sales/earnings for Caterpillar. The hypothetical trough/peak EPS is predicted to be approximately $12 and $33, respectively, with mid-cycle estimated at around $22. Despite these figures, Fisher anticipates a challenging first half of 2025 for Caterpillar, as North American construction adjusts after years of growth and as oil and gas expansion halts.For the first half of 2025, UBS's EPS estimate for Caterpillar is 3% below the consensus, with the expectation that negative revisions could further pressure the stock. Fisher's outlook is based on the assessment of the company's recent performance, which included narrower beats and an eventual miss in earnings, although there were higher margins in the construction sector and slightly more momentum in Energy & Transportation than initially expected. Despite these factors, the stock's reaction has not aligned with these developments, prompting the maintained Sell rating. It's worth noting that InvestingPro's comprehensive financial health assessment rates Caterpillar as "GREAT," with particularly strong scores in profitability and price momentum. For deeper insights into Caterpillar's valuation and future prospects, investors can access the detailed Pro Research Report, available exclusively to InvestingPro subscribers.
The UBS analyst has examined past cycles to estimate potential trough and peak sales/earnings for Caterpillar. The hypothetical trough/peak EPS is predicted to be approximately $12 and $33, respectively, with mid-cycle estimated at around $22. Despite these figures, Fisher anticipates a challenging first half of 2025 for Caterpillar, as North American construction adjusts after years of growth and as oil and gas expansion halts.
For the first half of 2025, UBS's EPS estimate for Caterpillar is 3% below the consensus, with the expectation that negative revisions could further pressure the stock. Fisher's outlook is based on the assessment of the company's recent performance, which included narrower beats and an eventual miss in earnings, although there were higher margins in the construction sector and slightly more momentum in Energy & Transportation than initially expected. Despite these factors, the stock's reaction has not aligned with these developments, prompting the maintained Sell rating.
In other recent news, Caterpillar announced that Chief Human Resources Officer Cheryl H. Johnson will retire in April, marking the end of her seven-year tenure with the company. Caterpillar Financial Services Corporation also successfully issued $1.25 billion in Medium-Term Notes, providing additional capital to support its operations. In the analyst arena, Evercore ISI downgraded Caterpillar's stock from 'In Line' to 'Underperform', citing potential earnings risks and competitive pressures, while DA Davidson raised its price target for Caterpillar to $350 from $337.
Barclays (LON:BARC) maintained an Equalweight rating on Caterpillar, noting copper as a smaller but growing market for the company. Caterpillar reported a 4% year-over-year decrease in Q3 sales, totaling $16.1 billion, primarily due to weaker performance in the Construction Industries and Resource Industries segments. Despite this, the company maintained a steady adjusted operating profit margin of 20% and an adjusted profit per share of $5.17.
Lastly, Caterpillar announced a multiyear capital investment to enhance its large reciprocating engine capacity, aiming to increase production capability by over 125% compared to 2023. Caterpillar's backlog slightly increased to $28.7 billion, indicating healthy demand in certain sectors. These are all recent developments in the company's operations.
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