Caterpillar earnings come in at $2.63, vs $2.37 EPS expected

3 things to watch Friday

Shares of Caterpillar fell on Friday after reporting a revenue miss in the fourth quarter, citing “global economic uncertainty.”

Industrial giant’s quarterly earnings came in at $2.63 per share adjusted, compared to an estimate of $2.37 per Refinitiv. However, its revenue fell 8% year-over year to $13.144 billion, below the estimate of $13.412 billion. CEO and chairman Jim Umpleby noted persisting risks around the world that weighed on the company’s revenue. 

“We expect continued global economic uncertainty to pressure sales to users in 2020 and cause dealers to further reduce inventories,” Umpleby said in a statement. “We have improved our lead times and remain prepared to respond quickly to any positive or negative changes in customer demand.”

Caterpillar also issued weaker-than expected guidance for full-year 2020, expecting an EPS of $8.5 to $10 compared to $10.63 that the Street was looking for.

The heavy machinery manufacturer’s stock dipped more than 1% in premarket trading Friday. Caterpillar shares have fallen nearly 10% in January alone, following a 16% gain last year.

At the height of the U.S.-China trade war last year, Caterpillar’s profits took a big hit from higher material costs, including tariffs.

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