Caterpillar (CAT) closed the most recent trading day at $616.10, moving +2.96% from the previous trading session. This move outpaced the S&P 500's daily gain of 0.64%. Meanwhile, the Dow experienced a rise of 1.23%, and the technology-dominated Nasdaq saw an increase of 0.69%.
Shares of the construction equipment company witnessed a loss of 0.79% over the previous month, trailing the performance of the Industrial Products sector with its gain of 1.92%, and the S&P 500's gain of 0.55%.
Investors will be eagerly watching for the performance of Caterpillar in its upcoming earnings disclosure. The company is predicted to post an EPS of $4.52, indicating a 12.06% decline compared to the equivalent quarter last year. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $17.84 billion, up 10% from the year-ago period.
For the full year, the Zacks Consensus Estimates are projecting earnings of $18.49 per share and revenue of $66.29 billion, which would represent changes of -15.57% and 0%, respectively, from the prior year.
Investors should also take note of any recent adjustments to analyst estimates for Caterpillar. Recent revisions tend to reflect the latest near-term business trends. As such, positive estimate revisions reflect analyst optimism about the business and profitability.
Research indicates that these estimate revisions are directly correlated with near-term share price momentum. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.
The Zacks Rank system, spanning from #1 (Strong Buy) to #5 (Strong Sell), boasts an impressive track record of outperformance, audited externally, with #1 ranked stocks yielding an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 0.61% higher. Caterpillar is currently a Zacks Rank #2 (Buy).
From a valuation perspective, Caterpillar is currently exchanging hands at a Forward P/E ratio of 27.21. This valuation marks a premium compared to its industry average Forward P/E of 12.79.
Also, we should mention that CAT has a PEG ratio of 2.36. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. CAT's industry had an average PEG ratio of 3.46 as of yesterday's close.
The Manufacturing - Construction and Mining industry is part of the Industrial Products sector. This industry currently has a Zacks Industry Rank of 184, which puts it in the bottom 25% of all 250+ industries.
The Zacks Industry Rank assesses the vigor of our specific industry groups by computing the average Zacks Rank of the individual stocks incorporated in the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Be sure to use Zacks.com to monitor all these stock-influencing metrics, and more, throughout the forthcoming trading sessions.
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Caterpillar Inc. (CAT): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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