What To Expect From Caterpillar's (CAT) Q1 Earnings

Construction equipment company Caterpillar (NYSE:CAT) will be reporting earnings tomorrow before the bell. Here’s what you need to know.

Caterpillar missed analysts’ revenue expectations by 2% last quarter, reporting revenues of $16.22 billion, down 5% year on year. It was a softer quarter for the company, with a significant miss of analysts’ adjusted operating income and organic revenue estimates.

Is Caterpillar a buy or sell going into earnings? Read our full analysis here, it’s free.

This quarter, analysts are expecting Caterpillar’s revenue to decline 7.3% year on year to $14.65 billion, a deceleration from its flat revenue in the same quarter last year. Adjusted earnings are expected to come in at $4.35 per share.

Analysts covering the company have generally reconfirmed their estimates over the last 30 days, suggesting they anticipate the business to stay the course heading into earnings.

Looking at Caterpillar’s peers in the heavy machinery segment, some have already reported their Q1 results, giving us a hint as to what we can expect. Lindsay delivered year-on-year revenue growth of 23.5%, beating analysts’ expectations by 4%, and Shyft reported revenues up 3.4%, topping estimates by 2.8%. Lindsay traded down 8% following the results while Shyft was up 18.1%.

Read our full analysis of Lindsay’s results here and Shyft’s results here.

Investors in the heavy machinery segment have had fairly steady hands going into earnings, with share prices down 1.3% on average over the last month. Caterpillar is down 7.2% during the same time and is heading into earnings with an average analyst price target of $355.08 (compared to the current share price of $306.10).

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