Earnings Preview: Caterpillar Inc.

Caterpillar (CAT) is expected to report Q2 earnings before market open Tuesday, July 22, with a conference call scheduled for 11:00 am ET.

Guidance

Analysts are looking for EPS of $1.55 on revenue of $12.68B. The consensus range for EPS is $1.44 to $1.69, while the consensus range for revenue is $12.08B to $13.02B, according to First Call.

When Caterpillar reported its Q1 earnings the company stated it expects FY08 EPS growth of 5% to 15%, and FY08 revenue growth of 5% to 10%. The company also stated in a conference call in April it sees economic recovery in 2009 to 2010 time frame, and its 2008 profits hinge on costs such as steel.

Analyst Views

UBS said on June 5, the risk/reward profile for owning machinery stocks given macro challenges and valuations. The firm downgraded the company to Sell from Neutral. Bernstein raised its Q2 EPS estimate for Caterpillar to $1.55 from $1.31 on July 11. The firm also raised its EPS estimate for the company's 2008 to $6.18 from $5.90, compared with the consensus of $6.02, as the firm thinks the company will benefit over the short-term from the global infrastructure boom. Over the medium and long-term, Bernstein believes Caterpillar will have continued end market strength, and it raised its target to $99.