In the latest trading session, Caterpillar (CAT) closed at $125.03, marking a -1.86% move from the previous day. This change lagged the S&P 500's daily gain of 1.45%. At the same time, the Dow added 1.22%, and the tech-heavy Nasdaq gained 0.78%.
Coming into today, shares of the construction equipment company had gained 26.53% in the past month. In that same time, the Industrial Products sector lost 11.97%, while the S&P 500 lost 7.42%.
Investors will be hoping for strength from CAT as it approaches its next earnings release, which is expected to be April 28, 2020. On that day, CAT is projected to report earnings of $1.81 per share, which would represent a year-over-year decline of 38.44%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $11.23 billion, down 16.62% from the year-ago period.
Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $7.40 per share and revenue of $44.75 billion. These totals would mark changes of -33.09% and -16.82%, respectively, from last year.
It is also important to note the 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. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.
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 20.69% lower. CAT currently has a Zacks Rank of #5 (Strong Sell).
Investors should also note CAT's current valuation metrics, including its Forward P/E ratio of 17.22. For comparison, its industry has an average Forward P/E of 14.72, which means CAT is trading at a premium to the group.
Investors should also note that CAT has a PEG ratio of 1.78 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. The Manufacturing - Construction and Mining was holding an average PEG ratio of 3.2 at yesterday's closing price.
The Manufacturing - Construction and Mining industry is part of the Industrial Products sector. This industry currently has a Zacks Industry Rank of 239, which puts it in the bottom 7% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our individual 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.
Make sure to utilize Zacks. Com to follow all of these stock-moving metrics, and more, in the coming trading sessions.
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Caterpillar Inc. (CAT) : Free Stock Analysis Report
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