Log in
Forgot password ?
Become a member for free
Sign up
Sign up
New member
Sign up for FREE
New customer
Discover our services
Dynamic quotes 

MarketScreener Homepage  >  Equities  >  Nyse  >  Caterpillar Inc.    CAT


News SummaryMost relevantAll newsPress ReleasesOfficial PublicationsSector newsMarketScreener StrategiesAnalyst Recommendations

Caterpillar : Sees Virus Prolonging Weak Demand

share with twitter share with LinkedIn share with facebook
08/01/2020 | 02:48am EDT

By Austen Hufford

The coronavirus crisis is sapping demand for Caterpillar Inc.'s giant machinery from builders and miners around the world.

Caterpillar said Friday that its revenue in the U.S. dropped more than 40% in the second quarter, and that demand from final customers fell around 22%. The company said it expects a similar decline for its third quarter.

"With the uncertainty out there with the economic environment, they are delaying making capital expenditures," Andrew Bonfield, Caterpillar's financial chief, said in an interview.

The company's shares fell 3.6% to $131.81.

Caterpillar said it was well-positioned to weather the crisis, with $8.8 billion of cash and $18.5 billion of available liquidity at the end of its second quarter.

Revenue fell globally across Caterpillar's three segments: Sales dropped 37% in construction, 35% in mining and 24% in its energy and transportation business.

Caterpillar, which makes sales through a network of independent dealers, said volumes fell $3.9 billion during the quarter, reflecting about a $2 billion reduction in final-user demand and a $1.9 billion hit to dealer inventories. Caterpillar said machinery sales to dealers dropped by nearly one-third globally.

While the company said some road-building customers reported faster construction times because of much lower road traffic, demand from them was more than offset by other customers delaying projects. The company also saw lower parts sales in some of its divisions and saw less services-related revenue, an indicator that customers were using their equipment less.

The company said it cut costs, including by using less temporary, contract labor at some of its facilities. The company's financial arm had set aside $515 million for credit losses, compared with $457 million at the end of the first quarter. The company said more customers were past due on their payments, even as it worked with them to extend terms and offer temporary relief.

"Customers were in pretty good financial health when they came into the crisis," Mr. Bonfield said.

In all, revenue declined 31%, falling to $10 billion, from $14.4 billion in the same quarter a year before. Profit declined 72% to $458 million, dropping to 84 cents a share from $2.83 in the same quarter a year before.

The company declined to provide guidance for the year, citing the uncertainty around the pandemic and the economy.

"It's very much a fluid, dynamic situation," Chief Executive Jim Umpleby told investors. "The virus starts to go away in an area, then can come back."

Write to Austen Hufford at austen.hufford@wsj.com


share with twitter share with LinkedIn share with facebook
Latest news on CATERPILLAR INC.
04:20pWALL STREET STOCK EXCHANGE : Stocks Edge Higher to Start the Week
02:57pWALL STREET STOCK EXCHANGE : U.S. Stocks Waver to Start the Week
01:19pWALL STREET STOCK EXCHANGE : U.S. Stocks Waver to Start the Week
11:25aWALL STREET STOCK EXCHANGE : U.S. Stocks Waver to Start the Week
08/06CATERPILLAR INC. : Form 8-K Exhibit 99.1
08/04CATERPILLAR : and CalAmp Extend Relationship on Industrial IoT Solutions
08/03WRAPUP 2-U.S. manufacturing activity near 1-1/2-year high, factory job losses..
08/03U.S. manufacturing activity near 1-1/2-year high, factory job losses persist
08/03EUROPE : Manufacturing rebound, U.S. stimulus hopes lift European stocks
08/03UK aerospace supplier Senior swings to loss, hit by pandemic
More news
Financials (USD)
Sales 2020 41 566 M - -
Net income 2020 2 925 M - -
Net Debt 2020 27 612 M - -
P/E ratio 2020 25,1x
Yield 2020 3,08%
Capitalization 73 060 M 73 060 M -
EV / Sales 2020 2,42x
EV / Sales 2021 2,26x
Nbr of Employees 102 300
Free-Float 66,3%
Duration : Period :
Caterpillar Inc. Technical Analysis Chart | MarketScreener
Full-screen chart
Technical analysis trends CATERPILLAR INC.
Short TermMid-TermLong Term
Income Statement Evolution
Mean consensus OUTPERFORM
Number of Analysts 26
Average target price 144,59 $
Last Close Price 134,92 $
Spread / Highest target 49,7%
Spread / Average Target 7,17%
Spread / Lowest Target -25,1%
EPS Revisions
Donald James Umpleby Chairman & Chief Executive Officer
Andrew Robert John Bonfield Chief Financial Officer
Karl E. Weiss Chief Technology Officer
Julie A. Lagacy Chief Information Officer & Vice President
William A. Osborn Independent Director