In the latest close session, Caterpillar (CAT) was down 1.75% at $486.71. The stock trailed the S&P 500, which registered a daily loss of 0.38%. Elsewhere, the Dow saw a downswing of 0.2%, while the tech-heavy Nasdaq depreciated by 0.67%.
The stock of construction equipment company has risen by 17.17% in the past month, leading the Industrial Products sector's gain of 1.98% and the S&P 500's gain of 4.06%.
Market participants will be closely following the financial results of Caterpillar in its upcoming release. In that report, analysts expect Caterpillar to post earnings of $4.56 per share. This would mark a year-over-year decline of 11.8%. Meanwhile, our latest consensus estimate is calling for revenue of $16.72 billion, up 3.81% from the prior-year quarter.
For the entire fiscal year, the Zacks Consensus Estimates are projecting earnings of $17.91 per share and a revenue of $64.83 billion, representing changes of -18.22% and +0.04%, respectively, from the prior year.
It's also important for investors to be aware of any recent modifications to analyst estimates for Caterpillar. Recent revisions tend to reflect the latest near-term business trends. As a result, upbeat changes in estimates indicate analysts' favorable outlook on the business health and profitability.
Research indicates that these estimate revisions are directly correlated with near-term share price momentum. 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, 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. Over the past month, the Zacks Consensus EPS estimate remained stagnant. As of now, Caterpillar holds a Zacks Rank of #4 (Sell).
Looking at its valuation, Caterpillar is holding a Forward P/E ratio of 27.66. This expresses a premium compared to the average Forward P/E of 24.86 of its industry.
One should further note that CAT currently holds a PEG ratio of 3.01. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. The average PEG ratio for the Manufacturing - Construction and Mining industry stood at 5.11 at the close of the market yesterday.
The Manufacturing - Construction and Mining industry is part of the Industrial Products sector. With its current Zacks Industry Rank of 180, this industry ranks in the bottom 28% of all industries, numbering over 250.
The Zacks Industry Rank gauges the strength of our 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.
To follow CAT in the coming trading sessions, be sure to utilize Zacks.com.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Caterpillar Inc. (CAT): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
Zacks Investment Research
