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Caterpillar (CAT) - presenting at the MINExpo analyst meeting - lowers its 2015 EPS forecast to...

Caterpillar (CAT) - presenting at the MINExpo analyst meeting - lowers its 2015 EPS forecast to $12-18/share from $15-20 previously. The guidance assumes no worldwide recession and continued modest economic growth. Shares -1.4% AH after a late slide left the price -0.9% in the regular session. (webcast) (presentation materials)
Comments (8)
  • Whitehawk
    , contributor
    Comments (3129) | Send Message
     
    A significant cut on the low end. Not much detail in this presentation, but it looks like projections for 2013 are slated as the contributor.
    24 Sep 2012, 07:15 PM Reply Like
  • Zach Tripp
    , contributor
    Comments (390) | Send Message
     
    good size cut, not a good sign. For a conservative long-term investor, assuming EPS of $9.59/share for FY12 (assumes $0.01 reduction from current Q3 and Q4 EPS) and a EPS of $12/share for FY15, a PEG of 1.0 results in $93/share. Only add to position below $93/share (buying for dividend).

     

    If a price appreciation is needed, say 8% CAGR minimum, and $93/share is reached by the end of FY14 (reflecting FY15 EPS). Add to your position under $79.75/share.

     

    http://scharts.co/Qg0Chc
    24 Sep 2012, 11:30 PM Reply Like
  • untrusting investor
    , contributor
    Comments (9925) | Send Message
     
    So CAT is joining a long list of other companies lowering revenue and earnings guidance. Not a surprise.
    24 Sep 2012, 11:40 PM Reply Like
  • Zach Tripp
    , contributor
    Comments (390) | Send Message
     
    I hope this is a one time lowering, meaning, they are good to FY15...
    26 Sep 2012, 09:34 PM Reply Like
  • recession12
    , contributor
    Comments (170) | Send Message
     
    Caterpillar is very expensive machinery. The Chinese are in the market selling identical machines 40% cheaper not good for Cat.
    24 Sep 2012, 11:58 PM Reply Like
  • Momintn
    , contributor
    Comments (3842) | Send Message
     
    Even the Chinese know to buy quality that lasts.
    25 Sep 2012, 11:26 AM Reply Like
  • Zach Tripp
    , contributor
    Comments (390) | Send Message
     
    Valid point. I think over the next 10-20 years there is going to be expanded infrastructure spending in the developed countries to mask some of the structural unemployment issues plus rapid expansion in the emerging markets. Some of CAT's potential sales will go to cheaper pieces of equipment, but, I am betting there will be plenty demand to allow CAT to expand it's EPS (and dividend) over the next 10 years.

     

    I missed the last dip to ~$80, I will not miss this one.
    26 Sep 2012, 09:39 PM Reply Like
  • Momintn
    , contributor
    Comments (3842) | Send Message
     
    With all of their acquisitions, I don't think CAT's 2015 will be on the low end. Looks like for engines, they are quite competitive with GE.
    26 Sep 2012, 10:01 PM Reply Like
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