Caterpillar Will Reduce Full Year Profit Forecast

Caterpillar will probably reduce its full year profit forecast because sales of mining, construction and power generation equipment are not meeting expectations, analysts and investors have said.

Since April 1st, at least eight analysts have pared their 2002 estimates for the largest maker of earthmoving equipment and said they anticipate that the company will follow. Caterpillar is projected to earn $2.49 a share in 2002, the average estimate of analysts surveyed by First Call. The company's forecast is for a slight increase from $2.60 last year.

Builders are not confident about the economy and are renting machinery rather than buying it, analysts said. Competitors from Japan and Korea, finding their markets even weaker, are vying for the limited US demand. Sales of high profit products such coal mining equipment have fallen by a fifth or more this year and probably will not rebound soon, investors have said.

“I expect Caterpillar to guide earnings (estimates) down,” said Damon Blakely, an analyst at the Cleveland based Victory Capital Management, which manages assets of about $70 billion, including Caterpillar shares. “Some of that downside is factored into the stock, but I think there's more downside to come.”


&to=' target=_blank>Caterpillar

Subscribe to Pravda.Ru Telegram channel, Facebook, RSS!

Author`s name Editorial Team