Caterpillar Drops Despite 2Q Earnings Beat

Caterpillar Drops Despite 2Q Earnings Beat

Shares of Caterpillar (CAT) fell almost 2.8% on Friday despite beating 2Q earnings estimates. Its 2Q adjusted earnings of $1.03 per share exceeded analysts’ estimates of $0.64. Moreover, revenues of $10 billion surpassed Street estimates of $9.38 billion. However, the company’s outlook for dealer inventories weighed on its stock.

During the second quarter, dealers reduced inventories for new equipment by $1.4 billion. The company now anticipates dealer inventories to decline by over $2 billion in 2020, up from its previous estimate of $1.5 billion.

Following 2Q earnings, Oppenheimer analyst Noah Kaye reiterated his Hold rating on the stock. He said, “While decrementals of 32% were consistent with our cross-cycle analysis, sales in construction, mining, and E&T broadly showed resilience.”



On July 24, Stifel Nicolaus analyst Stanley Elliott lifted the price target to $150 (12.9% upside potential) from $135 and reaffirmed a Buy rating. Elliott highlighted several “recent data points that suggest some upside relative to expectations for the machinery business.” He argued, “The results of component supplier Carlisle Brake & Friction, as well as Volvo Construction Equipment trends that were better than feared, suggest potential upside to Q2 and Q3 sell-side expectations, particularly in Caterpillar’s machinery segments.”

Overall, CAT analysts have a cautiously optimistic Moderate Buy consensus on the stock. The average analyst price target stands at $139.89, implying 5.3% upside potential from current levels. (See CAT stock analysis on TipRanks).

Related News:Comcast Beats Estimates On Robust Internet Customer GrowthMolson Coors Delivers Q2 Earnings Beat Despite Covid-19 FalloutExpedia Incurs Hefty Q2 Loss; Top Analyst Sticks To Buy Call

The post Caterpillar Drops Despite 2Q Earnings Beat appeared first on TipRanks Financial Blog.

S&P 500 
$3,333.69  -0.80%  
NASDAQ 100 
$10,876.08  -1.89%  
Dow Jones Industrial Average 
$27,686.91  -0.38%  
Apple Inc. 
$437.50  -2.97%  
Alphabet Inc. 
$1,480.32  -1.05%  
MICROSOFT CORP 
174,38 €  -0.68%  
Tesla, Inc. 
$1,374.39  -3.11%  
Berkshire Hathaway Inc. 
$319,380.00  0.17%  
AbbVie Inc. 
$92.67  0.31%  
Costco Wholesale Corporation 
$332.43  -2.23%  
Smartsheet Inc. 
$41.49  1.10%  
Zai Lab Limited 
$78.28  -1.72%  
Western Digital Corporation 
$36.98  -1.02%  
NVIDIA Corporation 
$434.00  -2.82%  
Gold Dec 20 
$1,945.90  -0.02%  
Crude Oil Sep 20 
$42.20  1.42%  
BTC/USD 
$11,494.06  0.73%  
Bitcoin Cash USD 
$286.92  1.27%  
LTC/USD 
$54.43  0.07%  
ETH/USD 
$382.29  0.50%  
Dogecoin USD 
$0.0035  2.12%