Caterpillar Inc. (CAT) on Q1 2021 Results - Earnings Call Transcript

Operator: Ladies and gentlemen, thank you for standing by, and welcome to the First Quarter 2021 Caterpillar Earnings Conference Call. At this time, all participants are in a listen-only mode. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Jennifer Driscoll. Thank you. Please go ahead. Jennifer Driscoll: Thank you, Jason. Good morning, everyone and welcome to Caterpillar's first quarter 2021 earnings call. Joining me this morning are Jim Umpleby, Chairman of the Board and CEO; Andrew Bonfield, Chief Financial Officer; Kyle Epley, Vice President of the Global Finance Services Division; and Rob Rengel, Senior IR Manager. During our call, we will be discussing the earnings news release we issued earlier this morning. Yu can find our slides from news release and the videos recap at investor.caterpillar.com by clicking on Events & Presentations. Also please note that we published new Caterpillar 2020 Data Book for investors, which you can also find today on the home page of IR website. The forward-looking statements we make today are subject to risks and uncertainties. We will also make assumptions that could cause our actual results to be different than the information we are sharing with you on this call. Please refer to our recent SEC filings and the forward-looking statements reminder in the news release for details on factors that individually or in aggregate could cause our actual results to vary materially from our forecast. Caterpillar has copyrighted this call. And we prohibit use of any portion of it without our prior written approval of the company. Today, we reported profit per share of $2.77 for the first quarter compared with $1.98 in the first quarter of 2020. We are showing adjusted profit per share in addition to our U.S. GAAP results. Our adjusted profit per share was $2.87 for the first quarter that compares with first quarter 2020 adjusted profit per share of $1.65. Adjusted profit per share for both quarters excluded restructuring cost. The first quarter of 2020 also excluded remeasurement gain of $0.38 per share, resulting from the settlement of a non-U.S. pension obligation. We provide a non-GAAP reconciliation in the appendix to this morning's news release. You can also find information on dealer inventory and backlog in our earnings call slides. Speaking of slides, before I turn it to Jim, there have been a few questions this morning on slide 16 key thoughts on the second quarter, the final bullet, we expect the operating profit margin percentage in the second quarter of 2021 to be moderately below the margin in the first quarter of 2021. Now with that, let's flip to slide three and turn the call over to our Chairman and CEO, Jim Umpleby. Jim Umpleby: Good morning. Thanks, Jennifer. I'd like to begin by thanking our global team for continuing to safely provide the essential products and services that enable our customers to support society during the pandemic. Our engaged team continues to execute our strategy, which is demonstrated by our first quarter results. I'll begin with my perspectives on the first quarter and our supply chain before discussing our end markets. Andrew Bonfield: Thank you, Jim and good morning, everyone. I will start out with an overview of our first quarter results. Then, I'll discuss segment performance and the balance sheets before concluding with some comments on the second quarter and remainder of 2021. As we reported this morning and showed on slide eight, sales and revenues for the first quarter increased by 12% to $11.9 billion on higher volumes. Operating profit of $1.8 billion rose by 29%, reflecting margin expansion, primarily due to higher volumes. First quarter profit per share was $2.77 compared to $1.98 in 2020. Adjusted profit per share was $2.87. It was a strong quarter and user demand was better than our expectations, primarily in Construction Industries, which also led to higher operating margins than we anticipated. Our adjusted operating profit margin increased by 230 basis points to 15.8%. The higher operating profit reflected higher volume, solid execution, good cost management and strengthen the financial products portfolio. These benefits more than offset the impact of reinstating the short-term incentive compensation program. Looking more closely the top line on slide nine, the 12% increase in reported sales and revenues reflected strong growth in Asia-Pacific, Latin America and the EAME. North America was about flat. In aggregate, sales to users increased by 8%. Dealer inventories rose as a seasonally typical led by Construction Industries. It increased by about $700 million versus an increase of about $100 million last year. Sales to users for Construction Industries increased by 17% versus the prior year, as end user demand, principally North America, is better than our expectations. All geographic regions improved. Asia-Pacific rose 36%, Latin America rose 38%, and the EAME rose 11%. North America increased 5%, making -- markings its third straight quarter of sequential improvement in quarter-over-quarter end user demand. Resource Industries, which tends to be grumpy, was flat, whereas we had expected a modest decline. Energy & Transportation sales to users decreased by 5%, which is broadly in line with our expectations. Amid stronger demand, the variability remained within our normal ranges for the vast majority of our products. However, we've had some isolated instances impacting a handful of products, such as true compact product families in our Building Construction Products portfolio. In these cases, we haven't been up to ramp up production as quickly as we'd like, mostly due to isolated issues, with a small number of specific supplies and/or labor availability. We are working hard to resolve these issues. Jennifer Driscoll: Thank you, Jason. Operator: At this time, we will open the Q&A session. Your first question comes from the line of Ann Duignan from JPMorgan. Your line is open. Ann Duignan: Hi. Good morning, everybody. Jim Umpleby: Morning, Ann. Ann Duignan: Answered a lot of my question in your last comments there, but I will just go back through it again for modeling purposes. But could you talk a little bit about the cadence of revenue and earnings through the rest of the year? I appreciate that margins would be down in Q2, given the absorption you got from inventory building in Q1. But of the things you can control, can you talk about them in a little bit more detail, R&D spend for the year, SG&A as a percent of sales, maybe how much of your steel is hedged versus not hedged just given the stronger than expected demand. And then, your comments about potentially not being able to meet end market demand this year. Are you confident that that demand will roll into 2022 and extend the cycle? Or is there any risk that -- market share or that demand that disappears as end market -- as customers get frustrated? Thank you. Jim Umpleby: Well, good morning, Ann. I think -- this is Jim. I'll answer your last question first and I'll turn it back over to Andrew for the rest. Just -- on that supply chain, as we mentioned, we're working very hard to avoid or minimize allowing supply chain issues to lead to production in shortfalls that would impact our ability to meet this improving customer demand. So, at this point, we're not saying that we'll definitely have a problem. We want to flag that it's a risk that we're managing, but certainly our goal is to, again, work very hard to minimize or limit any impact there. So, I don't want to speculate on -- go beyond that. That's really where we are. Andrew Bonfield: Okay. And then, talking about our overall margins, as I indicated a couple -- few months ago, I mean, we actually saw material cost favorability in the first quarter. That's for a couple of reasons. Obviously, the inventory we held at the end of 2020 flow through the P&L now. And also as you -- we do buy steel forward. We have about three-to-six-month full contract, normally on steel purchases. So, we do expect material costs to move from positive to negative, as we move forward, however, we all pricing accordingly with geo mix as well becoming favorable, we hope to be able to offset the two. Obviously, there is continued risk and material inflation as we look out. Overall though as we always remind you commodity costs -- commodity increases are net positive for us at Caterpillar, because it helps our customers buy more. On SG&A and R&D, spend was relatively low in Q1, part of that, obviously -- although -- obviously we did have a short term incentive comp increases. Part of that obviously is in the environment, we are still working in, still ramping up, going on a project -- you got -- obviously if you'd go to new project, we ended a lot of projects at the end of last year, starting them becomes a lot more difficult in an environment where people aren’t altogether. We expect that to accelerate since we go through the year, that particularly will impact R&D spend. And then obviously travel will impact SG&A as we get people back out on the road and people want to go out and meet customers, that will impact as we go forward. So, those are the sort of bits. As far as top line is concerned, I mean, obviously, that's going to depend on -- as we talked about the ability to meet the demand profile out there, and how actually customers feel as it goes through the year. As we indicated, demand signals are improving. And obviously that's going to be something we'll continue to monitor and may impact overall how the quarter has trend out from a top line perspective. Jennifer Driscoll: And just a reminder, one question per analyst, if you would. Next? Operator: Your next question comes from the line of Brett Linzey from Vertical Research. Your line is open. Brett Linzey: Good morning and thank you. Wanted to come back to your comment that you expect to meet your adjusted operating margin targets, maybe just a little more context there. Are you suggesting the midpoint is a reasonable expectation, or are there particular corridors within that range, upper half, lower half as a good planning assumption for the year? Thanks. Jim Umpleby: Good morning, Brett. Thanks for your question. We're not going to try to go into that level of detail. So, what we're saying is that we'll be within our target range for adjusted operating margins. But again, with all the puts and takes that we described this morning, we're not going to get into -- telling you exactly where we are within that range, but we expect to be within it. Operator: Your next question comes from the line of Jamie Cook from Credit Suisse. Your line is open. Jamie Cook: Hi, good morning and nice quarter. Jim Umpleby: Thanks, Jamie. Jamie Cook: My question is with -- my question is with regards to research, I think you talked about in your prepared remarks, some strategic deals as you're trying to grow your service business. So, I'm just wondering, is this sort of a one-off thing? Is this something that will happen more often within Resource that you're trying to grow the -- your service business and implications for margins for your Resource business throughout the cycle, because of these initiatives? Thanks. Jim Umpleby: Well, thanks Jamie. Within Resource Industries, we have Energy & Transportation occasionally as well. It's a lumpy business where you can have a large project move quarter-to-quarter, move our margins, move our price realization. And the comments that we made were in the context of price. And we talked about the fact that we had a large strategic -- in larger strategic deals count in the quarter, book in the quarter, that impacted price. So, we always -- when we look at a project we take into account the future services opportunity. We always do that. And so, again, with those multi businesses, you should expect things to move around quarter-to-quarter. And what we're really focused on is that long-term profitable growth that comes from growing services, seeding the population, growing the aftermarket, but you'll see things move around up and down. We see that in both E&T and in Resource Industries and that again will continue. Operator: Your next question comes from the line of Mig Dobre from Baird. Your line is open. Mircea Dobre: Thank you. Good morning, everyone. I was wondering if you can maybe provide a little more context around what you're seeing in mining. Certainly, you're sounding more positive. But I'm kind of curious if you can -- maybe talk a little bit about how your orders or backlog has been progressing here and look, I mean, it sounds that commodity prices out there are back to prior highs, highs. So, I'm kind of wondering here, are you actually starting to see a real replacement cycle on the OE side starting to develop? Thank you. Jim Umpleby: Mig, thanks for your question. And as you indicated, certainly copper, iron, iron ore, gold, all very, very strong. And we've been talking about this for the last few quarters that we're having very positive conversations with our mining customers. Certainly, they're being disciplined in their capital expenditures, but things are improving. So, our orders are improving. There's a number of projects that we're tendering that are multiyear in nature, where we feel very positive about our competitive position because of our autonomous solution across a number of products. So, again, as I talked about earlier, we're not expecting a very fast ramp up or a spike. We're seeing more of a gradual improvement and that's continuing. And so, again, we're quite encouraged by what we see. And we start to think about how Caterpillar is positioned from a mining perspective as the energy transition occurs with the growth of EVs with the -- just the amount of demand that will be created by that, Caterpillar is very well-positioned to do -- to take advantage of that and to serve our customers, make them more successful. And it'll be good for us and our dealers as well. Operator: Your next question comes from the line of Rob Wertheimer from Melius Research. Your line is open. Rob Wertheimer: Hi. Good morning and thank you. My question is on connected assets. You touched on it briefly. I just wonder if you can detail any more progress where the opportunity seem to be widening as you look into what you can do for your customers versus your targets. And then, just in general, we've seen some industrial companies start to partner with a tech company maybe for the AI or the machine learning analytics side of it. And you've maybe gone a foot down that road and back again. Does it feel like your strategy is fully fleshed out, and what you're going to do with it? Or are you still learning and might still partner? Is there something else you need? Just an update, please. Thank you. Jim Umpleby: Thanks, Rob. Services is a never ending journey. So, it will never be done. And as -- I know you're aware we've invested heavily in our digital capabilities and we're continuing to do that. We are -- we've got over a million connected assets and we are now working to leverage those connected assets to find ways to add value our customers. And again, that also adds value to Caterpillar and our dealers. I mentioned in my prepared remarks about prioritized service events or PSEs, that is something that we're flushing out and continuing to invest in. So, if your question is, are we there yet? No, we're not there. Working to need to invest. This is a long journey, but we're pleased by the progress that we've been making over the last two or three years. Operator: Your next question comes from the line of Ross Gilardi from Bank of America. Your line is open. Ross Gilardi: Thanks. Good morning, guys. Jim Umpleby: Good morning, Ross. Ross Gilardi: I just wanted to go back to question I asked a few quarters ago. It sort of piggybacks off of Mircea’s question on mining. And is there anything structural that's holding you back in your core mining equipment business to offset some of these positives that you mentioned? I'm not talking heavy construction or quarry, but just core mining equipment, whether it's your whole exposure. I mean, it's autonomy, in any way cannibalizing new equipment demand. It's just -- it's a bit puzzling that the business is still doing $2 billion to $2.5 billion of revenue per quarter, which is pretty much what you've been since 2014. And should we think of our -- just sort of long-term just range bound and $8 billion to $10 billion annual revenue range through the cycle. Jim Umpleby: Well, as I mentioned earlier, again, we are optimistic about our mining business. We believe that mining will benefit from many of the trends that are occurring in terms of the energy transition. We're very pleased with our competitive position due to autonomy and other capabilities that we have as well, our dealers or product support. So, actually, we're quite optimistic. And so, I'm quite the opposite, really. I'm being negative about it. We're quite optimistic about the opportunity for future profitable growth in mining. We've been talking for a number of quarters that we don't expect a rapid peak or a rapid acceleration. We've talked about a gradual improvement. And then, if we talked about the last few -- the last few quarters, and that's what we're starting to see. So, again, things are playing out very much as we had expected, and as we shared with all of you in our previous earnings call. Operator: Your next question comes from the line of Nicole DeBlase from Deutsche Bank. Your line is open. Nicole DeBlase: Thanks. Good morning, guys. Jim Umpleby: Good morning. Nicole DeBlase: Can we just talk about the price cost environment what you have seen from a competitive perspective, your ability to raise price to combat raw material inflation throughout the rest of the year? Andrew Bonfield: Yeah. Nicole, it’s Andrew, and good morning. Yes. I mean, obviously, as I indicated in my remarks, we do expect that obviously, raw material inflation is going to have some impact later this year through the reminder of the year. We're all pricing for that. We do not see at this stage an issue with that pricing. So, we're all comfortable -- what increases we'll put in through are on not going to have an impact. As you always know, Caterpillar is normally the price leader and that helps us in the environment. We put through very modest price increases at the beginning of the, so that did enable us to have a little bit more scope to put for the price increases for now. Operator: Your next question comes from the line of Steve Fisher from UBS. Your line is open. Steve Fisher: Thanks. Good morning. I wanted to just ask you a little bit more about the mix in construction and how that will affect margins. It sounds like you're anticipating a little bit of a shift from residential to perhaps commercial and heavier application, and maybe there could be a bit of a rotation from Asia to North America. Is that how you're seeing it? And maybe about the timing of that shift and sort of what you're counting on to help mitigate the price cost dynamics from mix over the course of the year. Thank you. Jim Umpleby: Good morning, Steven. So, I don't believe we talked really about a shift from one to the other. What we talked about is that -- the fact that the residential is quite strong and we see some improvement in heavy construction starting to happen. Asia, there's the normal selling season that occurs in China associated Chinese New Year. So, I wouldn't talk about it is really as a rotation. I would just talk about it as in some ways normal seasonal patterns, but in other ways, again, an improvement in that heavy construction, which has been quite depressed. So, we're starting to see some improvement there. So, I'd characterize it that way as opposed to a rotation. Andrew Bonfield: Yeah. And I think, also, Steve, as we always look out, I mean, we tend to look out margins and managing them over many quarters rather than just individual quarters. So, obviously, while there may be mixed impacts from quarter-to-quarter, pricing impacts from things like geo mix and so forth, obviously there are other things that go the other way. So, we're always looking at the overall margin structure, making sure we manage that appropriately. Operator: Your next question comes from the line of Adam Uhlman from Cleveland Research. Your line is open. Adam Uhlman: Hey, guys. Good morning. Jim Umpleby: Good morning. Adam Uhlman: Wondering -- I was wondering if we could expand a bit on the dealer inventory positions right now. And if you could share your thoughts about how you're thinking about that for the rest of the year, because I think you indicated that you thought that to be stable until the second quarter. At the same time dealer inventory is at the low end of year range. And I think you indicated that your -- that normal availability for the majority of your products, I guess, why would dealers not build up more to get to kind of the average level of your targeted ranges? Thanks. Jim Umpleby: Well, Adam, thanks for your question. I always have to remind you, of course, dealers are independent businesses and they control their own inventory. What we're really focused on is meeting end user demand. And we talked about the strength and stews and the improving situation in a number of markets that we serve. We've talked a bit about some of the supply chain challenges, but our laser focus will be on ensuring that -- doing our very best to meet that end user demand. And all we're saying again, dealers are independent businesses. All we're trying to predict here at this point is that we don't anticipate as we sit here today, a significant increase in dealer inventory in 2021. So, we're producing closer to demand and of course, dealer inventory will again be dependent on a whole wide variety of factors. Operator: Your next question comes from the line of Steve Volkmann from Jefferies. Your line is open. Steve Volkmann: Great. Good morning, everybody. I had a mixed question as well, but in Resource, some of the channel checks seem to suggest that we're seeing stronger order activity for machines relative to parts, which is a little bit counter intuitive, almost part of the cycle. I'm just curious if you're seeing that as well. And why do you think it might be? Jim Umpleby: Well, I think maybe what we're seeing is just an improvement in OE. Again, as we mentioned earlier in the call, we're starting to see some improvement in the heavy construction part of RI off a relatively low base, but we're also seeing an upturn in mining orders, that is gradual, but as you see that, that certainly could have an impact on mix. Operator: Your next question comes from the line of Chad Dillard from Bernstein. Your line is open. Chad Dillard: Hi. Good morning, guys. Jim Umpleby: Good morning, Chad. Andrew Bonfield: Good morning, Chad. Chad Dillard: Just had a question on price cost and Op margins, wanted to just clarify couple of things. So, first of all, with the price cost and assuming commodities stay where they are, do you foresee the price cost balance at least being neutral either in this year, or will it probably take until like 2022 for that to materialize? And then, just on operating margins, am I right in assuming that Op margin is going to be the highest in 1Q and drifting down through the rest of the year? Jim Umpleby: Yeah. So, first of all, on the sort of price cost, what we’re expecting is -- for the -- overall for the full year to be in about balance. That's based on plans today and forecast today. Obviously, one of the things we’re pointing out is supply chain risks are out there, which do mean that they include raw material risks, which may impact pricing as we go forward, particularly on the cost side, as we go through the balance of the year. So, that’s one of the things we’ll keep an eye on. Obviously, what we talked about in -- where we -- the only thing we're really saying about operating margins at this stage is that they will be within the Investor Day target range. And then, obviously, in the first -- from Q1 to Q2, we do expect that obviously operating margins will moderate slightly in Q2, mostly due to the factors I spoke about earlier, absorption rates being one of them, but also obviously the timing of price cost as well as that comes through. Operator: Your next question comes from the line of Joel Tiss from BMO. Your line is open. Joel Tiss: Hey, guys. How it going? Nice quarter, good free cash flow, unbelievable. I wonder if you could just give us a little sort of your editorial on between customer commentary and your unique position in this market, like how durable do you feel like the customer commentary like the recovery is going to be in -- for 2022, 2023. I'm not asking for forecast, just sort of your color from all the different inputs you guys get. Jim Umpleby: Okay. Joel, you asked the most difficult question of the morning so far. So, certainly, we've talked about -- maybe the way to do this is talk about various markets. We talked about mining. And we've talked about the fact that we expect that gradual increase to continue. We have no reasons to think that it will stop. But again, it’s very difficult for us to try to judge out what's going to happen two or three years. And when we put our strategy together in 2017. One of things we really focused on is performing better at all points in the cycle. We talked about having 300 to 600 basis points better on operating margin regardless of where we're in that cycle compared to the historical past, which we defined as 2010, 2016 and also producing $1 billion to $2 billion of incremental ME&T free cash flow at all points in the cycle. So, that's what we're really focused on. So, again, as we sit here today, we are optimistic about what we see the things are improving in some markets that have been depressed. We've talked about the strength in mining. But again, it's just very difficult to try to judge what will happen two or three years out. There are so many factors that can impact it. Operator: Your next question comes from the line of David Raso from Evercore ISI. Your line is open. David Raso: Hi. Thank you. My question is with dealer inventory. You noted you ended 2020 at the lower end of the normal range of month of sales. And if we're not going to see a restock this year of inventory while retail sales will grow, it does suggest the month of inventory relative to sales is going to be lower at the end of the year. Obviously that sets up a very positive 2022 for your machine production, even if retail sales were just flat. So, I was hoping if you can give us some sense of magnitude where your scenario plays out on how far below normal would you expect dealer inventory to be at the end of the year. Andrew Bonfield: Yeah. David, as we’ve tried to indicate, we're not expecting this year is a significant increase in dealer inventory. That doesn’t mean that there won’t be any. So, actually -- because obviously, as you quite rightly point out, if the continues to improve, obviously dealers would normally want to hold more inventory. What we are focused on is making sure we can meet demand in the current year and then use the demand. And given some of the, obviously, challenges and risks that are out there, that is really our focus rather than concentrating on what we think actually out year-end inventory will be. Obviously, we'll see how that pans out for the remainder of the year and see how dealers are thinking about 2022 as we get to the end of the year at this stage. Operator: Your next question comes from the line of Jerry Revich from Goldman Sachs. Your line is open. Jerry Revich: Yes. Hi. Good morning, everyone. Jim Umpleby: Good morning, Jerry. Jerry Revich: One of the points from your customers on the mining side is, they are also setting their long-term CO2 reduction targets. And I am just wondering if you can talk about the opportunities that they have with your products to reduce their CO2 levels. And if you care to comment on when hydrogen in mining trucks is feasible in your view within that equation? Thanks. Jim Umpleby: Thanks, Jerry. And certainly, we are working with our customers in mining and in other areas of our business as well to help them achieve their climate related objectives. It’s a bit early to make any kind of announcements here this morning, but certainly we are in discussions with our mining customers and we will work to help them meet their objectives. Jennifer Driscoll: Okay. With that, we will turn it back to Jim to make his closing remarks. Jim Umpleby: All right. Well, again, I appreciate everyone joining us this morning. Couldn’t be more proud of the team and how they performed in the first quarter, a lot of positive signals. We talked about some challenges we have, but we are managing our way through those. We appreciate everyone’s attention this morning. Thank you. Jennifer Driscoll: Thank you, Jim. Thanks, Andrew, and everybody who joined us on the call today. We appreciate your time with us. A replay of our call will be available online later this morning. We will post the transcript on our Investor Relations website later today. Our first quarter results video with our CFO and an SEC filing with our sales to users data are already posted there as our updated slides and the new Caterpillar 2020 Data Book that I mentioned earlier. To find the Diversity & Inclusion Report that Jim referenced, click on caterpillar.com, then Careers, then Diversity & Inclusion. If you have any questions, please reach out to Rob or me. You can reach Rob at rengel_rob@cat.com. I am at driscoll_jennifer@cat.com. The Investor Relations general phone number is 309-675-4549. We hope you enjoy the rest of your day and have a nice weekend. And now I will turn it back to Jason to conclude our call. Operator: That concludes today's conference call. Thank you everybody for joining. You may now disconnect.
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Caterpillar Gets an Upgrade at Melius

Melius returned to a bullish stance on Caterpillar (NYSE:CAT), upgrading the stock to a Buy and setting a price target of $500. The move reflects a sharp upward revision in long-term earnings projections, especially for 2027, driven by the growing role of Caterpillar's engine business in powering next-generation data centers.

This shift in outlook doesn’t rely on a rebound in traditional markets like construction or mining. Instead, it focuses on Caterpillar’s expanding presence in power generation—an area becoming increasingly critical amid the surge in demand from artificial intelligence infrastructure. The firm sees Caterpillar playing a more integral role in providing essential and continuous power, far beyond just backup systems, as the strain on the electrical grid intensifies.

Compared to peers enjoying rich valuation multiples, Caterpillar still trades at a more conservative level. But Melius now believes the company deserves a re-rating. Their $500 price target implies a 30% upside based on a 17x earnings multiple, reflecting confidence in the company’s potential to capture long-term growth in data center-driven power needs.

Caterpillar Inc. (NYSE:CAT) Maintains Bullish Outlook Amid Economic Growth

  • Caterpillar Inc. (NYSE:CAT) receives a "Buy" rating from Bank of America Securities, reflecting confidence in its growth prospects.
  • The stock price shows a positive trend, with a current increase of $4.73 or 1.37%, indicating investor optimism.
  • Caterpillar celebrates its 100th anniversary with a limited-edition boot collection, highlighting its significant contributions to global infrastructure.

Caterpillar Inc. (NYSE:CAT) is a leading manufacturer of construction and mining equipment, diesel and natural gas engines, and industrial gas turbines. The company has a significant impact on global infrastructure, contributing to major projects like the Golden Gate Bridge and the Apollo 11 Moon Landing. Caterpillar competes with companies like Komatsu and John Deere in the heavy machinery industry.

On June 3, 2025, Bank of America Securities reiterated its "Buy" rating for Caterpillar, maintaining a bullish outlook. The stock price at the time was $349.40, as highlighted by Benzinga. The decision was influenced by the "surprisingly durable" U.S. economy and global momentum, which are expected to support Caterpillar's growth.

Caterpillar's stock price reflects a positive trend, with a current increase of $4.73 or 1.37%. The stock has fluctuated between $344.92 and $350.83 during the day. Over the past year, CAT has seen a high of $418.50 and a low of $267.30, indicating significant volatility. The company's market capitalization stands at approximately $164.33 billion.

In celebration of Caterpillar's 100th anniversary, Cat Footwear, a division of Wolverine World Wide, Inc., launched a limited-edition boot collection. This collection honors Caterpillar's contributions to global infrastructure, including the Golden Gate Bridge and the Apollo 11 Moon Landing. Each boot serves as a tribute to these monumental achievements.

Today's trading volume for CAT is 2,613,068 shares, reflecting investor interest in the stock. Caterpillar's century-long impact on infrastructure and its current market performance highlight its significance in the industry. The company's ability to adapt to global economic conditions supports its continued growth and success.

Caterpillar Inc. (NYSE:CAT) Annual Shareholder Meeting and Financial Performance Review

  • Caterpillar Inc. (NYSE:CAT) reported a revenue of $64.8 billion in 2024, demonstrating its industry leadership.
  • The company announced a dividend of $1.41 per share, reflecting its commitment to shareholder returns.
  • CAT's stock reached a high of $324.67, indicating strong investor confidence despite recent financial challenges.

Caterpillar Inc. (NYSE:CAT) is a global leader in manufacturing construction and mining equipment, off-highway diesel and natural gas engines, industrial gas turbines, and diesel-electric locomotives. The company is set to hold its virtual annual shareholder meeting on June 11, 2025, at 8 a.m. CDT. Shareholders who owned Caterpillar common stock as of April 14, or their legal proxy holders, can participate in the meeting. They will have the opportunity to submit questions and vote on various items, with details available in Caterpillar's 2025 proxy statement.

In 2024, Caterpillar reported a revenue of $64.8 billion, solidifying its position as a leader in its industry. The company operates through three main segments: Construction Industries, Resource Industries, and Energy & Transportation. Additionally, it offers financing and related services through its Financial Products segment. Despite its strong market presence, Caterpillar's recent financial performance showed some challenges. On April 30, 2025, the company reported earnings per share of $4.25, slightly below the estimated $4.35, and generated quarterly revenue of approximately $14.25 billion, which fell short of the estimated $14.72 billion.

Caterpillar's commitment to its shareholders is evident in its dividend announcements. On April 21, 2025, the company declared a dividend of $1.41, with the record date also being April 21, 2025. Shareholders can expect the payment to be made on May 20, 2025. This declaration was made earlier on April 9, 2025, showcasing the company's dedication to providing returns to its investors despite recent earnings misses.

The company's stock performance remains strong, with CAT reaching a high of $324.67 recently. This reflects investor confidence in Caterpillar's long-term strategy and its efforts to build a more sustainable world. As the company continues to navigate the challenges of the global market, its focus on sustainability and innovation will likely play a crucial role in its future success.

Caterpillar Inc. (NYSE:CAT) Annual Shareholder Meeting and Financial Performance Review

  • Caterpillar Inc. (NYSE:CAT) reported a revenue of $64.8 billion in 2024, demonstrating its industry leadership.
  • The company announced a dividend of $1.41 per share, reflecting its commitment to shareholder returns.
  • CAT's stock reached a high of $324.67, indicating strong investor confidence despite recent financial challenges.

Caterpillar Inc. (NYSE:CAT) is a global leader in manufacturing construction and mining equipment, off-highway diesel and natural gas engines, industrial gas turbines, and diesel-electric locomotives. The company is set to hold its virtual annual shareholder meeting on June 11, 2025, at 8 a.m. CDT. Shareholders who owned Caterpillar common stock as of April 14, or their legal proxy holders, can participate in the meeting. They will have the opportunity to submit questions and vote on various items, with details available in Caterpillar's 2025 proxy statement.

In 2024, Caterpillar reported a revenue of $64.8 billion, solidifying its position as a leader in its industry. The company operates through three main segments: Construction Industries, Resource Industries, and Energy & Transportation. Additionally, it offers financing and related services through its Financial Products segment. Despite its strong market presence, Caterpillar's recent financial performance showed some challenges. On April 30, 2025, the company reported earnings per share of $4.25, slightly below the estimated $4.35, and generated quarterly revenue of approximately $14.25 billion, which fell short of the estimated $14.72 billion.

Caterpillar's commitment to its shareholders is evident in its dividend announcements. On April 21, 2025, the company declared a dividend of $1.41, with the record date also being April 21, 2025. Shareholders can expect the payment to be made on May 20, 2025. This declaration was made earlier on April 9, 2025, showcasing the company's dedication to providing returns to its investors despite recent earnings misses.

The company's stock performance remains strong, with CAT reaching a high of $324.67 recently. This reflects investor confidence in Caterpillar's long-term strategy and its efforts to build a more sustainable world. As the company continues to navigate the challenges of the global market, its focus on sustainability and innovation will likely play a crucial role in its future success.

Caterpillar Inc. (NYSE:CAT) Stock Analysis: A Deep Dive into Performance and Market Sentiment

  • Caterpillar's average price target has decreased from $372.09 to $283, indicating a bearish sentiment among analysts.
  • Despite declining price targets, Caterpillar is expected to surpass earnings estimates in its upcoming report.
  • United Rentals is presented as a more attractive investment option by some analysts, with a strong EBITDA margin of 46.7% and a diversified customer base.

Caterpillar Inc. (NYSE:CAT) is a prominent player in the global market, known for its manufacturing and sale of construction and mining equipment, engines, and turbines. The company operates through various segments, including Construction Industries, Resource Industries, Energy & Transportation, and Financial Products, each offering a diverse range of products and services. Caterpillar's extensive portfolio positions it as a key competitor in the heavy machinery industry.

Over the past year, there has been a noticeable shift in the consensus price target for Caterpillar's stock. A year ago, the average price target was $372.09, but it has since decreased to $291.5 in the last quarter and further to $283 in the past month. This downward trend suggests a more cautious or bearish sentiment among analysts regarding Caterpillar's stock performance. Factors such as market conditions, company performance, and broader economic influences on the industries Caterpillar serves could contribute to this change.

Despite the declining price targets, Caterpillar is anticipated to surpass earnings estimates in its upcoming report, as highlighted by Zacks. The company is believed to have the right mix of factors that could lead to an earnings beat. However, Wells Fargo analyst Seth Weber has set a lower price target of $231 for Caterpillar, indicating a more conservative outlook for the stock.

In contrast, United Rentals, the world's largest equipment rental provider, is highlighted as a more attractive investment option by some analysts. United Rentals boasts a fleet valued at $21.43 billion and reported $15.3 billion in revenue for fiscal year 2024. The company maintains a strong EBITDA margin of 46.7% and benefits from a diversified customer base and strategic mergers and acquisitions. This stability, coupled with limited exposure to residential construction, makes United Rentals a resilient choice against tariffs and market fluctuations.

Caterpillar recently experienced a significant increase in its share price, rising by 9.9% during the last trading session with above-average trading volume. Despite this impressive performance, the current trend in earnings estimate revisions does not suggest continued strength for the stock in the near future. Investors should consider these changes in analyst sentiment alongside other company news and financial performance metrics to make informed decisions about investing in Caterpillar Inc.

Caterpillar Inc. (NYSE:CAT) Stock Analysis: A Deep Dive into Performance and Market Sentiment

  • Caterpillar's average price target has decreased from $372.09 to $283, indicating a bearish sentiment among analysts.
  • Despite declining price targets, Caterpillar is expected to surpass earnings estimates in its upcoming report.
  • United Rentals is presented as a more attractive investment option by some analysts, with a strong EBITDA margin of 46.7% and a diversified customer base.

Caterpillar Inc. (NYSE:CAT) is a prominent player in the global market, known for its manufacturing and sale of construction and mining equipment, engines, and turbines. The company operates through various segments, including Construction Industries, Resource Industries, Energy & Transportation, and Financial Products, each offering a diverse range of products and services. Caterpillar's extensive portfolio positions it as a key competitor in the heavy machinery industry.

Over the past year, there has been a noticeable shift in the consensus price target for Caterpillar's stock. A year ago, the average price target was $372.09, but it has since decreased to $291.5 in the last quarter and further to $283 in the past month. This downward trend suggests a more cautious or bearish sentiment among analysts regarding Caterpillar's stock performance. Factors such as market conditions, company performance, and broader economic influences on the industries Caterpillar serves could contribute to this change.

Despite the declining price targets, Caterpillar is anticipated to surpass earnings estimates in its upcoming report, as highlighted by Zacks. The company is believed to have the right mix of factors that could lead to an earnings beat. However, Wells Fargo analyst Seth Weber has set a lower price target of $231 for Caterpillar, indicating a more conservative outlook for the stock.

In contrast, United Rentals, the world's largest equipment rental provider, is highlighted as a more attractive investment option by some analysts. United Rentals boasts a fleet valued at $21.43 billion and reported $15.3 billion in revenue for fiscal year 2024. The company maintains a strong EBITDA margin of 46.7% and benefits from a diversified customer base and strategic mergers and acquisitions. This stability, coupled with limited exposure to residential construction, makes United Rentals a resilient choice against tariffs and market fluctuations.

Caterpillar recently experienced a significant increase in its share price, rising by 9.9% during the last trading session with above-average trading volume. Despite this impressive performance, the current trend in earnings estimate revisions does not suggest continued strength for the stock in the near future. Investors should consider these changes in analyst sentiment alongside other company news and financial performance metrics to make informed decisions about investing in Caterpillar Inc.

UBS Slashes Caterpillar Price Target, Warns of Deeper Earnings Risk

UBS reaffirmed its Sell rating on Caterpillar (NYSE:CAT) while significantly lowering its price target to $243 from $385, citing growing concerns over macroeconomic pressures that could undercut the company's earnings trajectory.

While Caterpillar has already started to lag due to weakening demand and softer pricing trends, UBS sees further deterioration ahead, particularly as tariffs and economic uncertainty weigh on construction, oil & gas, and mining sectors. The firm views these segments as especially vulnerable given their sensitivity to global economic momentum.

UBS forecasts Machinery, Energy & Transportation (ME&T) revenue to decline 7% in the second half of 2025, in stark contrast to Wall Street’s expectation of a 2% rise. The firm is also significantly more cautious than consensus on 2026 earnings, projecting results 28% below current Street estimates.

Given Caterpillar’s status as a barometer for global industrial health, UBS believes continued macro softness justifies a more bearish outlook, with downside risks outweighing potential near-term catalysts.