Caterpillar shares leap as big equipment demand powers Q4 earnings beat
Published 4:43 am Monday, February 5, 2024
- Caterpillar's energy-and-transport sales led its 2023 fourth-quarter results.
Caterpillar (CAT) – Get Free Report shares moved firmly higher in early Monday trading after the industrial equipment maker posted stronger-than-expected fourth-quarter earnings powered by a big jump in energy and transportation sales.
Caterpillar said adjusted profit for the three months ended in December were pegged at $5.23 a share, up nearly 35.5% from the same period in 2022 and well ahead of the Wall Street consensus forecast of $4.75 a share.
Group revenue, Caterpillar said, rose 3% to $17.1 billion, essentially matching analysts’ estimates, while its adjusted operating profit margin widened to 18.9% for the quarter, compared with the 17% tally recorded a year earlier.
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“I’m very proud of our global team’s strong performance as they achieved the best year in our 98-year history, including record full-year sales and revenues, record adjusted profit per share and record ME&T free cash flow,” said CEO Jim Umpleby. “We remain committed to serving our customers, executing our strategy and investing for long-term profitable growth.”
Caterpillar shares, a Dow component, were marked 4.4% higher in premarket trading to indicate an opening bell price of $328.588 each, a move that would extend the shares’ six-month gain to around 17%.
Caterpillar sales by division
Construction sales slipped 5% from a year ago to $6.52 billion, Caterpillar said, “driven by the impact from changes in dealer inventories, partially offset by higher sales of equipment to end users.”
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Resource industry sales were down 6% to $3.24 billion thanks to “lower sales volume, partially offset by favorable price realization,” Caterpillar said. “The decrease in sales volume was driven by the impact from changes in dealer inventories and lower aftermarket parts sales volume.”
Energy and Transportation rose 12% from a year earlier to $7.67 billion, “primarily due to higher sales volume and favorable price realization.”
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