Construction equipment company Caterpillar (NYSE:CAT) will be reporting earnings tomorrow before market hours. Here's what investors should know.
Caterpillar missed analysts' revenue expectations by 1.2% last quarter, reporting revenues of $15.8 billion, flat year on year. It was a slower quarter for the company, with a miss of analysts' 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 3.7% year on year to $16.67 billion, a reversal from the 21.6% increase it recorded in the same quarter last year. Adjusted earnings are expected to come in at $5.54 per share.
The majority of analysts covering the company have reconfirmed their estimates over the last 30 days, suggesting they anticipate the business to stay the course heading into earnings. Caterpillar has missed Wall Street's revenue estimates three times over the last two years.
Looking at Caterpillar's peers in the heavy machinery segment, some have already reported their Q2 results, giving us a hint as to what we can expect. Terex's revenues decreased 1.5% year on year, missing analysts' expectations by 3.2%, and Cummins reported revenues up 1.8%, topping estimates by 5.3%. Terex traded down 3.6% following the results while Cummins's stock price was unchanged.
Read our full analysis of Terex's results here and Cummins's results here.
There has been positive sentiment among investors in the heavy machinery segment, with share prices up 2.8% on average over the last month. Caterpillar is down 2.5% during the same time and is heading into earnings with an average analyst price target of $347.5 (compared to the current share price of $320.87).
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