Dear Valued Visitor,

We have noticed that you are using an ad blocker software.

Although advertisements on the web pages may degrade your experience, our business certainly depends on them and we can only keep providing you high-quality research based articles as long as we can display ads on our pages.

To view this article, you can disable your ad blocker and refresh this page or simply login.

We only allow registered users to use ad blockers. You can sign up for free by clicking here or you can login if you are already a member.

Caterpillar Inc. (CAT): An Early Preview of Monday’s Earnings

Sales declines are clearly to blame for the immediate hit to Caterpillar Inc. (NYSE:CAT)’s stock. By contrast, even though industry peers have seen revenue growth rates slow, they’ve nevertheless remained positive. Deere & Company (NYSE:DE) , for instance, is expected to see sales of its agricultural equipment rise more than 4%, bucking Caterpillar’s big drops. In March, Caterpillar reported a year-over-year drop of 13% for the preceding three months, with declines everywhere but in Latin America.

The collapse in gold prices earlier this week added another dimension to Caterpillar’s woes. Behind the gold headlines, other commodities also saw sizable losses, sending mining stocks of all sorts lower. Mining-equipment rival Joy Global Inc. (NYSE:JOY) also fell sharply, as it has even greater exposure to China, where commodities activity has been particularly strong. If miners have to rein in production activity even more due to lower prices and relatively high costs, then they’ll stop buying mining equipment from Caterpillar Inc. (NYSE:CAT) and Joy Global Inc. (NYSE:JOY), causing another drag on their earnings.

In Caterpillar’s earnings report, pay close attention to any long-term guidance the company offers. With past calls stretching out as far as 2015, the company has a keen insight on longer-term trends that most businesses never share with investors. What Caterpillar Inc. (NYSE:CAT) says could give you a stronger sense of what’s ahead not only for the company, but for the overall industrial economy.

The article An Early Preview of Monday’s Caterpillar Earnings originally appeared on

Fool contributor Dan Caplinger has no position in any stocks mentioned. You can follow him on Twitter @DanCaplinger. The Motley Fool has no position in any of the stocks mentioned.

Copyright © 1995 – 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.

DOWNLOAD FREE REPORT: Warren Buffett's Best Stock Picks

Let Warren Buffett, George Soros, Steve Cohen, and Daniel Loeb WORK FOR YOU.

If you want to beat the low cost index funds by 19 percentage points per year, look no further than our monthly newsletter.In this free report you can find an in-depth analysis of the performance of Warren Buffett's entire historical stock picks. We uncovered Warren Buffett's Best Stock Picks and a way to for Buffett to improve his returns by more than 4 percentage points per year.

Bonus Biotech Stock Pick: You can also find a detailed bonus biotech stock pick that we expect to return more than 50% within 12 months.
Subscribe me to Insider Monkey's Free Daily Newsletter
This is a FREE report from Insider Monkey. Credit Card is NOT required.