Caterpillar – Will Caterpillar Stocks Trade Below Fourth Quarter Results?
is expected to release its fourth quarter 2020 results on Friday, January 29. We expect Caterpillar to show mixed results with beating revenues, while profits are below consensus estimates, due to a sequential rebound in construction demand. We expect the company to navigate well based on these trends in the last quarter. However, our forecast indicates that Caterpillar’s valuation is around $ 158 per share, which is 15% lower than the current market price of around $ 187. Our interactive dashboard analysis on contains additional details. Trefis estimates Caterpillar’s fourth-quarter 2020 revenue at around $ 11.35 billion, slightly ahead of the consensus estimate of $ 11.25 billion. While the project schedule and cash flow of real estate developers have been affected due to the shutdown of some construction activities in 2020 impacting the activities of Caterpillar, the gradual opening of economies and the resumption of construction activities should have helped sales in the fourth quarter. Excluding construction, the demand for equipment for oil and gas applications is expected to remain much lower compared to the previous year period. That said, the fourth quarter is generally stronger for Caterpillar in the oil and gas segment, a trend that likely continued into 2020 as well. Caterpillar sales in the third quarter of 2020 were down 23% to $ 9.9 billion, with sales down across all segments. Our dashboard offers more details on the business segments. Caterpillar’s adjusted fourth quarter 2020 earnings per share is expected to be $ 1.38 per Trefis analysis, compared to $ 1.49 according to the consensus estimate. Caterpillar’s adjusted net income of about $ 734 million in the third quarter of 2020 reflects a 51% decline from its $ 1.5 billion figure in the previous year quarter. Margins are likely to improve in the future as demand for construction equipment as well as energy and transportation rebounds gradually. For the year 2020, we expect Adjusted EPS will be less than $ 5.35 compared to $ 11.06 in 2019.
- According to Fintech Zoom “Caterpillar Stock To Trade Lower Post Q4 Results?”.
- However, our forecast indicates that Caterpillar’s valuation is around $ 158 per share, which is 15% lower than the current market price of around $ 187. Our interactive dashboard analysis on contains additional details.
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