Caterpillar (CAT) Gains As Market Dips: What You Should Know

Caterpillar (CAT) closed at $128.96 in the latest trading session, marking a +1.47% move from the prior day. This change outpaced the S&P 500's 0.34% loss on the day. Elsewhere, the Dow gained 0.05%, while the tech-heavy Nasdaq lost 0.69%.

Investors will be hoping for strength from CAT as it approaches its next earnings release. On that day, CAT is projected to report earnings of $0.69 per share, which would represent a year-over-year decline of 75.62%. Our most recent consensus estimate is calling for quarterly revenue of $9.05 billion, down 37.28% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $4.94 per share and revenue of $40.85 billion, which would represent changes of -55.33% and -24.07%, respectively, from the prior year.

Any recent changes to analyst estimates for CAT should also be noted by investors. Recent revisions tend to reflect the latest near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 1% lower. CAT is holding a Zacks Rank of #5 (Strong Sell) right now.

Looking at its valuation, CAT is holding a Forward P/E ratio of 25.72. This represents a premium compared to its industry's average Forward P/E of 20.79.

We can also see that CAT currently has a PEG ratio of 2.14. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. Manufacturing - Construction and Mining stocks are, on average, holding a PEG ratio of 3.11 based on yesterday's closing prices.

The Manufacturing - Construction and Mining industry is part of the Industrial Products sector. This industry currently has a Zacks Industry Rank of 226, which puts it in the bottom 12% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Make sure to utilize Zacks. Com to follow all of these stock-moving metrics, and more, in the coming trading sessions.

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