Yahoo Finance Caterpillar (CAT) Laps the Stock Market: Here's Why
In the latest market close, Caterpillar (CAT) reached $325.14, with a +0.85% movement compared to the previous day. The stock outperformed the S&P 500, which registered a daily gain of 0.25%. Meanwhile, the Dow experienced a rise of 0.15%, and the technology-dominated Nasdaq saw an increase of 0.03%.
The construction equipment company's stock has dropped by 11.12% in the past month, falling short of the Industrial Products sector's loss of 4.58% and the S&P 500's gain of 3.34%.
Investors will be eagerly watching for the performance of Caterpillar in its upcoming earnings disclosure. The company is expected to report EPS of $5.59, up 0.72% from the prior-year quarter. Alongside, our most recent consensus estimate is anticipating revenue of $16.85 billion, indicating a 2.7% downward movement from the same quarter last year.
For the full year, the Zacks Consensus Estimates are projecting earnings of $21.81 per share and revenue of $67.04 billion, which would represent changes of +2.83% and -0.03%, respectively, from the prior year.
Investors might also notice recent changes to analyst estimates for Caterpillar. These revisions help to show the ever-changing nature of near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.
Our research reveals that these estimate alterations are directly linked with the stock price performance in the near future. To exploit this, we've formed the Zacks Rank, a quantitative model that includes these estimate changes and presents a viable rating system.
The Zacks Rank system, running from #1 (Strong Buy) to #5 (Strong Sell), holds an admirable track record of superior performance, independently audited, with #1 stocks contributing an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 0.04% higher within the past month. Caterpillar currently has a Zacks Rank of #3 (Hold).
Looking at valuation, Caterpillar is presently trading at a Forward P/E ratio of 14.78. This valuation marks a premium compared to its industry's average Forward P/E of 9.85.
One should further note that CAT currently holds a PEG ratio of 1.65. The PEG ratio is akin to the commonly utilized P/E ratio, but this measure also incorporates the company's anticipated earnings growth rate. As of the close of trade yesterday, the Manufacturing - Construction and Mining industry held an average PEG ratio of 1.65.
The Manufacturing - Construction and Mining industry is part of the Industrial Products sector. This group has a Zacks Industry Rank of 190, putting it in the bottom 25% of all 250+ industries.
The Zacks Industry Rank is ordered from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
To follow CAT in the coming trading sessions, be sure to utilize Zacks.com.
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Caterpillar Inc. (CAT) : Free Stock Analysis Report
